Buying to let in Cabarete
Most of our buyers use their property for part of the year and let it for the rest. Here is how the letting market actually works on the north coast, and the costs that come with it.
Two seasons, not one
The high season for the north coast runs from December to April, driven by North American and European visitors escaping winter. The wind season, which is what brings kite and wing surfers, runs roughly from December through August and peaks between June and August. The result is a demand curve with two peaks rather than a single winter spike, which is unusual in the Caribbean and is the main reason Cabarete letting works.
Who rents
Kite and wing surfers on two to four week stays, families on winter escapes, remote workers on one to six month stays, and a steady trickle of buyers doing a trial season before purchasing. Villas with private pools and three or four bedrooms attract groups and families. One- and two-bedroom apartments attract couples and long-stay individuals.
Short-term vs long-term
Short-term letting through the usual platforms gives the highest gross yield and the most work: cleaning turnover, guest communication, maintenance and platform commission of 3-15%. Long-term letting to the resident expatriate community gives a lower gross yield, near-zero vacancy and almost no management overhead. A common pattern is short-term through the peak months and a long-term tenant for the rest of the year.
What it costs to run
Budget for HOA fees, electricity (the single largest variable cost if air-conditioning runs all day), water, internet, insurance, and a management company at 15-25% of gross rental income if you are not on the island. Furnishing a two-bedroom to letting standard typically runs $12,000-25,000 depending on how far you go.
Tax on rental income
Rental income earned in the Dominican Republic is taxable in the Dominican Republic. Non-resident individuals are subject to withholding at 27% on gross rents, or you can operate through a local company and deduct real expenses. Which of those is cheaper depends entirely on your numbers and your home-country tax position, so take advice from a Dominican accountant before you buy, not after.
A note on the numbers
We do not publish projected yields. Any developer who guarantees you a specific return in writing is selling you a financial product, not a house. What we will do is show you the real rates being achieved on comparable units in Cabarete right now and let you build your own model.
Ask for the real numbers
We send comparable rates for the same street, not projected yields.