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Cabarete delivers some of the Caribbean's highest rental yields, with beachfront condos generating 7-12% gross annual returns. Short-term rentals in prime locations consistently outperform long-term leases by 30-50%, though they require higher management commitment and operational costs.
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Cabarete offers superior rental yields compared to most Caribbean coastal cities, with robust demand from tourism and a maturing short-term rental market.
Beachfront condos and villas in top neighborhoods deliver the best investment results, with net yields ranging from 5-8% after all expenses.
| Property Type | Gross Rental Yield | Net Rental Yield | Best Neighborhoods |
|---|---|---|---|
| Beachfront Condos | 7-12% | 5-8% | Cabarete Beach, Kite Beach |
| Gated Community Villas | 7-10% | 5-7% | Pro Cab, Ocean Dream, Seawinds |
| Standard Apartments | 5-8% | 4-6% | Inland areas, Cabarete East |
| Vacation Rentals (Airbnb) | 8-15% | 6-10% | Encuentro Beach, Kite Beach |
| Long-term Rentals | 6-9% | 4-6% | All neighborhoods |
What are the current average rental yields in Cabarete by property type and neighborhood?
Cabarete rental yields vary significantly by property type and location, with beachfront properties commanding the highest returns.
Beachfront condos generate 7-12% gross annual yields, with prime oceanfront units achieving the upper range due to consistent demand from tourists and water sports enthusiasts. Villas in gated communities like Pro Cab, Ocean Dream, and Seawinds deliver 7-10% yields, appealing primarily to retirees, expatriates, and families seeking security and amenities.
Standard apartments in inland or lesser locations produce 5-8% average yields, typically attracting long-stay expatriates, digital nomads, and seasonal workers. Encuentro Beach leads the market with 10-15% annual appreciation and strong yields driven by surf culture and eco-tourism focus. Cabarete Beach and Kite Beach areas achieve the highest rental yields at 8-12% with strong occupancy rates, favored by tourists and digital nomads.
Pro Cab and Cabarete East provide reliable long-term and mid-term occupancy with yields ranging from 7-10%.
As of September 2025, these yields reflect the town's growing reputation as a premium Caribbean investment destination.
How have rental yields in Cabarete changed compared to one year ago and five years ago?
Cabarete rental yields have shown consistent upward growth over both short and long-term periods.
Compared to September 2024, average yields were 6.5-8%, marginally lower than current levels. Both property prices and rental rates increased 6-8% year-over-year, with yields improving due to stronger rental demand outpacing price appreciation. The tourism recovery and infrastructure improvements contributed to this positive trajectory.
Five years ago in 2020, yields averaged 5-7% across all property types. Market appreciation and tourism growth have raised yields significantly, with beachfront properties experiencing the most substantial improvements. The consistent upward trend has brought current gross yields to 7-12% for prime locations.
This growth trajectory reflects skyrocketing tourism numbers, increased infrastructure investment, and Cabarete's emergence as a top Caribbean destination for water sports and digital nomadism.
The market has demonstrated resilience and growth despite global economic uncertainties.
What is the forecast for rental yields in Cabarete over the next one, five, and ten years?
Cabarete rental yield forecasts remain optimistic across all time horizons, though growth rates are expected to moderate from current levels.
For 2026-2027, projected annual rental yields will range from 7-11%. Beachfront and prime condo yields should remain near the top of this range due to supply constraints and continued tourism growth. The Dominican Republic's growing international profile and improved connectivity will support these projections.
By 2030, yields are forecast to stabilize at 6-9%, reflecting expected moderation in appreciation rates while maintaining strong demand fundamentals. Infrastructure developments and the maturation of the short-term rental market will contribute to sustained performance.
The 2035+ outlook suggests healthy long-term yields of 5-8% due to continued economic growth, infrastructure upgrades, and Cabarete's enduring appeal for international visitors and investors.
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How do Cabarete's rental yields compare with other similar coastal cities?
Cabarete significantly outperforms most comparable Caribbean and Latin American coastal destinations in rental yield potential.
| City | Average Gross Rental Yield | Market Characteristics |
|---|---|---|
| Cabarete | 7-12% | Highest yields, booming tourism & water sports draw |
| Punta Cana | 5-9% | Comparable yields but lower year-round occupancy |
| Sosua | 6-10% | Good yields but less premium for beachfront |
| Cancun, Mexico | 4-7% | Larger market with diluted yields |
| Playa del Carmen | 5-8% | Established market with moderate returns |
| Tulum | 6-9% | Higher entry costs limit overall yields |
| Costa Rica Pacific Coast | 4-7% | Stable but lower yield market |
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What are the average property purchase prices in Cabarete, including all fees and taxes, by property type and size?
Cabarete property prices vary significantly by location, size, and proximity to the beach, with additional costs typically adding 3-5% to the base purchase price.
Beachfront condos command premium prices, with 1-bedroom units (50-70m²) ranging from $129,000-$155,000, plus a 15% premium for direct ocean views. Two-bedroom beachfront condos (90-120m²) cost $175,000-$210,000. Inland apartments offer more affordable entry points, with 2-bedroom units (80-120m²) priced at $95,000-$150,000.
Luxury villas in gated communities represent the high-end market, with 4-5 bedroom properties (185-200m²) ranging from $450,000-$800,000. These prices reflect premium locations, security, and resort-style amenities.
Property tax applies at 1% annually for properties valued above $79,290 USD. Transaction costs including legal fees and taxes typically add 3-5% to the purchase price.
These prices position Cabarete as an accessible Caribbean market compared to established destinations like Barbados or the Bahamas.
What are the main differences in average rent between short-term and long-term rentals in Cabarete?
Short-term rentals in Cabarete generate substantially higher income than long-term leases, though with increased operational complexity and seasonal fluctuations.
Short-term Airbnb properties earn $75-$150 per night for apartments, while villas command $250-$700 nightly during peak season. The median Airbnb property generates $1,100 monthly, with top-performing properties exceeding $4,380 monthly during peak periods. Annual gross income from successful short-term rentals can reach $20,000-$50,000 for well-located condos.
Long-term rentals provide more predictable income streams, with apartments averaging $1,300 monthly (range: $800-$1,750). Villas rent for $1,500-$10,000 monthly depending on size, location, and amenities. Annual income from long-term rentals typically ranges from $15,000-$35,000 for standard properties.
Short-term rentals yield 30-50% higher income potential but require professional management, higher maintenance costs, marketing efforts, and constant guest turnover. Long-term rentals offer stability, lower management costs, and reduced vacancy risks.
The choice depends on investment goals, hands-on involvement preference, and risk tolerance.
What are example rental yields for different property types and sizes in Cabarete?
Specific property examples demonstrate how location, size, and property type directly impact rental yield performance in Cabarete.
| Property Type | Average Purchase Price | Average Monthly Rent | Gross Annual Yield |
|---|---|---|---|
| Beachfront Condo (2BR, 90m²) | $200,000 | $1,600 | 9.6% |
| Inland Apartment (2BR, 80m²) | $140,000 | $1,100 | 9.4% |
| Gated Villa (5BR, 200m²) | $500,000 | $4,500 | 10.8% |
| Standard Condo (1BR, 60m²) | $130,000 | $950 | 8.8% |
| Luxury Beachfront (3BR, 150m²) | $350,000 | $2,800 | 9.6% |
| Budget Apartment (1BR, 45m²) | $85,000 | $650 | 9.2% |
What are the typical renter profiles for each property type and rental term in Cabarete?
Cabarete attracts diverse renter demographics, with property type and location determining the primary tenant profiles.
Beachfront condos primarily attract short-term international tourists, digital nomads, and water sports enthusiasts seeking proximity to kite surfing and windsurfing activities. These renters expect high-speed wifi, fully equipped kitchens, air conditioning, pool access, and beach proximity. Rental periods typically range from 3 days to 3 months.
Gated community villas appeal to long-term expatriates, retirees, and families seeking security, luxury amenities, and privacy. These tenants often sign 6-12 month leases and value golf access, 24/7 security, maintenance services, and community facilities. Many are American or Canadian retirees relocating permanently or seasonally.
Standard apartments attract seasonal workers, long-stay travelers, budget-conscious expats, and local professionals. Rental terms vary from 3-12 months, with tenants prioritizing affordability, reliable utilities, and convenient location over luxury amenities.
Short-term vacation rentals draw adventure tourists, wedding parties, surfing groups, and digital nomad communities seeking authentic Caribbean experiences with modern conveniences.
It's something we develop in our Dominican Republic property pack.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in the Dominican Republic versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
What is the current vacancy rate in Cabarete, broken down by property type and rental term?
Cabarete vacancy rates vary significantly between short-term and long-term rentals, with professional management substantially improving occupancy performance.
Average market-wide Airbnb occupancy reaches 33%, though professionally managed properties in prime locations achieve 57-77% occupancy, translating to vacancy rates of 23-43%. Beachfront properties and those near water sports centers consistently outperform inland options. Peak season (December-April) sees occupancy rates above 80% for well-managed properties.
Long-term rental vacancy rates typically remain lower at 10-20% in high-demand neighborhoods during peak season, rising to 20-30% during off-season periods (May-November). Gated communities and security-focused properties maintain the lowest vacancy rates due to stable expatriate demand.
Properties with professional property management, quality furnishing, reliable wifi, and strategic pricing achieve significantly better occupancy rates across all categories. Location remains the primary factor determining vacancy rates, with beachfront and Kite Beach area properties maintaining the highest occupancy year-round.
The market shows strong seasonal patterns, requiring strategic pricing and marketing approaches to maximize annual occupancy.
What are the typical ongoing expenses for rental properties in Cabarete, including maintenance, management, utilities, and other costs?
Cabarete rental property expenses significantly impact net yields, with professional management and beachfront locations incurring higher operational costs.
- Property management: 20-30% of gross rental income for full-service management including marketing, guest communication, cleaning, and maintenance coordination
- Maintenance costs: $1,500-$3,500 annually for condos, $5,000+ for large villas, covering repairs, painting, appliance replacement, and preventive maintenance
- Utilities: $150-$300 monthly for apartments (water, electricity, internet), significantly higher for villas with pools and extensive air conditioning
- Property taxes: 1% annually for properties valued above $79,290 USD, paid to Dominican tax authorities
- Insurance coverage: $400-$800 annually depending on coverage level, property value, and natural disaster protection
- HOA/condo fees: $100-$250 monthly for building maintenance, security, common areas, and amenities
- Cleaning and supplies: $30-$60 per turnover for short-term rentals, plus ongoing supply costs for linens, toiletries, and household items
What is the breakdown from gross rental yield to net rental yield for typical properties in Cabarete, considering costs, taxes, and mortgage payments?
Converting gross rental yields to net returns requires accounting for substantial operational expenses that significantly impact investment performance.
A typical beachfront condo example shows the yield progression: starting with a 9% gross yield, property management fees reduce returns by 2%, maintenance costs subtract another 0.7%, utilities account for 1%, and taxes plus HOA fees remove 0.6%. This results in a net yield of approximately 4.7-5.7% after all expenses.
Inland apartments typically achieve net yields in the 4-6% range after expenses, starting from lower gross yields but also incurring reduced operational costs. Luxury villas may maintain higher gross yields but face proportionally higher maintenance, utilities, and management costs.
Properties financed with mortgages see additional reductions based on interest rates and loan terms. Dominican mortgage rates typically range from 8-12% annually, significantly impacting leveraged investment returns. Cash purchases avoid financing costs but require larger initial capital commitments.
Professional property management, while reducing net yields, often increases gross rental income through higher occupancy rates and premium pricing, potentially improving overall returns despite the management fees.
Currency exchange considerations and Dominican peso fluctuations can also impact returns for international investors.
Based on current data, what property types and locations offer the smartest investment choices in Cabarete today?
Current market conditions favor specific property types and locations that combine strong yields with appreciation potential and manageable operational complexity.
Beachfront condos with proven occupancy history represent the optimal investment choice, offering 7-12% gross yields with strong appreciation potential. Focus on 2-3 bedroom units in established buildings near Cabarete Beach and Kite Beach areas. These properties balance accessibility for management, tourist appeal, and reasonable purchase prices.
Luxury villas in gated communities like Pro Cab, Ocean Dream, and Seawinds provide excellent long-term stability with 7-10% yields and appeal to high-quality tenants. These properties require higher initial investment but offer reduced vacancy risks and premium rental rates.
Apartments near water sports hubs, particularly around Encuentro Beach, offer emerging value with 10-15% annual appreciation rates. The surf culture and eco-tourism focus drive consistent demand from active travelers and digital nomads.
Key investment advantages include high rental yields (7-12% gross, 5-7% net), robust occupancy especially for professionally managed short-term rentals, consistent property value appreciation (8-10% annually), and strong international buyer demand supported by the Dominican Republic's pro-business investment climate.
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Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Cabarete's rental yield market demonstrates exceptional performance compared to regional competitors, with beachfront properties delivering the strongest returns for investors.
Professional property management and strategic location selection remain critical factors for maximizing net yields and maintaining competitive occupancy rates in this dynamic market.
Sources
- Blue Sail Realty - Dominican Republic Real Estate 2025
- The LatinVestor - Cabarete Real Estate Market
- The LatinVestor - Cabarete Price Forecasts
- The LatinVestor - Cabarete Property
- InStyle Investments - Real Estate in Cabarete
- Global Property Guide - Dominican Republic Price History
- Blue Sail Realty - Vacation Rentals in Cabarete
- AirROI - Cabarete Market Report
- Cabarete Real Estate - Investing in Cabarete Condos
- Dreaming DR - Cabarete Property for Rent