The 15 strongest trends for the Dominican Republic real estate market in 2025

Authored by the expert who managed and guided the team behind the Dominican Republic Property Pack

Everything you need to know before buying real estate is included in our The Dominican Republic Property Pack

Are you considering investing in the Dominican Republic's real estate market? Curious about the emerging trends that could influence your property purchase decision in 2025? Want to know which areas are set to boom and what factors are driving these changes?

We will lay down recent insights. Here, no guesswork, we rely only on solid data.

Actually, we know this market inside and out. We keep tabs on it regularly, and all our discoveries are reflected in the most recent version of the Dominican Republic Property Pack

This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.

1) Punta Cana and Bávaro property prices are skyrocketing as tourists and expats flood the market!

Coastal hotspots like Punta Cana and Bávaro are seeing rising property prices thanks to their popularity with tourists and expats.

In 2023, Punta Cana was a magnet for visitors, drawing in 42% of all tourists to the Dominican Republic, with over 8 million people visiting. This momentum carried into 2024, as more people booked flights, hinting at a strong tourism season ahead.

Punta Cana International Airport is bustling, with over 66,000 commercial flights landing by the end of 2023. The airport's 77% occupancy rate shows just how many people are flocking to these shores, fueling a real estate boom.

Investors are pouring money into the area, especially in luxury developments. Places like Cap Cana and Punta Cana Village are seeing significant price hikes due to limited housing and high demand.

In Punta Cana, property prices are climbing steadily. Recently, apartment prices have jumped by 7%, while houses have seen a 5% increase, reflecting the area's growing appeal.

Sources: The Latinvestor, DMK Lawyers, The Agency DR

2) Santo Domingo's Colonial Zone urban renewal is set to skyrocket residential investment!

Urban renewal in Santo Domingo's Colonial Zone is poised to draw in residential investors.

The government has injected US$36 million into the Revitalization Program, Tu Ciudad Colonial, with a total of US$90 million earmarked for the project. This funding is backed by the Inter-American Development Bank and the European Union, signaling strong international support. As these funds flow in, the area is set to transform, making it a prime spot for new residents.

Property values in the Colonial Zone are expected to climb. While exact figures aren't available, the substantial investment and ongoing improvements suggest a positive trend. As the area becomes more appealing, both tourists and locals are likely to drive demand, pushing property values higher.

Tourism is a key player here. In 2022, Santo Domingo welcomed over 8.5 million tourists, and there's a target to hit 9.8 million by 2025. The Colonial Zone, with its charming 16th-century architecture, is a magnet for visitors, featuring museums, restaurants, and boutique hotels. This influx of tourists is a boon for potential property investors.

Looking at similar projects, the success story of Punta Cana stands out. Once revitalized, it became a major tourist hub and saw a surge in residential investment. This sets a promising precedent for Santo Domingo's Colonial Zone, suggesting a similar trajectory.

Investor interest is on the rise, fueled by the thriving tourism sector and enticing government incentives. These include tax breaks and residency perks for those buying property, making the Colonial Zone an attractive option for foreign investors.

Sources: Dominican Today, Travel Pulse, SSRN, SE Florida ULI

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3) Stricter environmental rules will go up building costs, driving up final sale prices dramatically

Stricter environmental regulations are making it more expensive to build homes in the Dominican Republic.

Builders now have to use eco-friendly materials, which are pricier than traditional ones. This shift has contributed to a 38% increase in building costs from 2020 to 2024. These regulations are not just about being green; they directly affect your wallet if you're looking to buy a property.

Construction companies have seen a 31.5% rise in the cost of main inputs for building projects. This means that the price tag on new homes is climbing, as developers pass these increased costs onto buyers. So, if you're considering purchasing a new home, be prepared for higher prices.

Take cement, for example. In 2024, its price jumped by RD$100 compared to 2023. This hike is a direct result of the need to meet new environmental standards, which demand more costly materials and processes. It's a clear sign of how these regulations are reshaping the housing market.

These changes are not just numbers on a page; they reflect a broader trend in the construction industry. Builders are navigating a new landscape where environmental considerations are paramount, and this is having a tangible impact on the cost of building and buying homes.

Sources: Dominican Today, Dominican Today, Arizton

4) Virtual property tours will go up sales to international buyers who can't visit in person

Virtual property tours are revolutionizing the way international buyers purchase homes.

In the Dominican Republic, real estate agents have embraced 3D animation and virtual experiences, allowing foreign investors to explore properties without setting foot in the country. This trend, which took off around 2023, has only gained traction, making it a staple in the real estate market.

Modern home buyers are driving this change, with a global survey revealing that 67% of them prefer virtual tours when house hunting. This demand has led more agencies in the Dominican Republic to offer virtual open houses, a necessity highlighted during the COVID-19 pandemic for safe and convenient property viewing.

Virtual tours are not just a convenience; they are a financial boon. They save international buyers from costly and time-consuming travel. Properties with virtual tours tend to sell for 9% more and close 31% faster, making them appealing to sellers eager to maximize their returns.

Technological advancements have made these tours even more engaging. With 3D visualization and augmented reality, buyers can experience properties in a more immersive way, boosting their enthusiasm and interest. Real estate companies are partnering with tech firms to ensure buyers have access to cutting-edge technology.

Sources: PhotoUp, NAR Realtor, Realtor DR

5) Incentives for affordable housing will go up profits for developers in the Dominican Republic

The Dominican Republic is making affordable housing more appealing for developers through government incentives and subsidies.

With the World Bank's $100 million loan for the "Happy Family National Housing Plan," developers face less risk, making affordable housing a more attractive investment. This plan aims to provide homes for low-income families, creating a win-win situation for both developers and the community.

Over 60% of the population lives in precarious conditions, driving a strong demand for affordable housing. The country's growing economy further fuels this demand, offering developers a lucrative market to tap into. The housing deficit, estimated between 1.4 million and 2.2 million units, presents a golden opportunity for developers to step in and profit.

Take the PNVFF initiative, for example, which shows how affordable housing can be profitable. This program supports thousands of families in buying their first homes, improving urban living, and attracting private sector investment. Such success stories highlight the potential for developers to thrive in this sector.

Partnerships between developers and government agencies, like those seen in the PNVFF, create a collaborative environment that fosters successful projects. These alliances are crucial in navigating the affordable housing landscape and ensuring profitability.

With the right support and strategy, developers can turn affordable housing into a profitable venture, benefiting both themselves and the community. Incentives for affordable housing are making this segment more profitable for developers.

Sources: World Bank, UNDP, Habitat for Humanity

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6) Urban rent prices will go up as housing demand surges past new construction!

The urban population in the Dominican Republic has surged to over 9.5 million in 2023.

This growth is largely due to people moving to cities for better job prospects in construction and tourism. However, finding a place to live is becoming a challenge.

There's a significant housing shortage because there's not enough land available for new buildings in urban areas. The government has noted a housing deficit of about 2.1 million units, which shows just how big the gap is between what's needed and what's available.

Making things tougher, new housing projects are slowing down. Predictions show a drop in multifamily property completions from 533,000 units in 2024 to just 250,000 by 2026.

Rising construction costs are a big part of the problem, leading to fewer new developments and a noticeable decline in construction starts over recent years.

Sources: Simply Dominican, Trading Economics, Rental Housing Journal

7) Short-term rentals will go up in profits as tourism booms, leaving traditional leases in the dust!

The Dominican Republic is seeing a huge boom in tourism, with over 10 million visitors in 2023.

This surge has made the country a top spot in the Caribbean, and as tourism picks up, short-term rentals are becoming the go-to choice for many travelers.

Platforms like Airbnb are leading the charge, with nearly 60% of the lodging room supply in the Dominican Republic by March 2023. This trend is likely to keep growing into 2024 as more travelers prefer these flexible accommodations.

Short-term rentals often bring in higher average daily rates than traditional leases. For instance, during the Juan Luis Guerra concert in February 2023, rental prices shot up to $600, showing the potential for property owners to earn more.

With events and festivals drawing crowds, short-term rentals can capitalize on these opportunities, making them a profitable venture for those looking to invest in property.

As tourism continues to thrive, the demand for short-term rentals is expected to rise, offering better returns compared to traditional leases.

Sources: Travel Week, Dominican Today, Beyond Pricing

8) Urban migration is set to slash rural home demand, triggering a dramatic drop in prices

Urban migration is reshaping the housing market in the Dominican Republic, with more people moving to cities than ever before.

In 2023, the net migration rate was -2.631 per 1000 population, showing a clear preference for urban living. This trend persisted into 2024, with a slightly improved rate of -2.589 per 1000 population, reinforcing the shift towards city life.

The urban population made up a significant 84.45% of the total population in 2023, and this number is only expected to rise. As cities grow, rural areas naturally see a decline, with only 15.55% of people living in rural areas in 2023, down from 16.15% the previous year.

With the younger generation favoring urban areas for better jobs and amenities, rural regions are experiencing a drop in housing demand. This shift is evident as rural schools report declining enrollment, mirroring the population decrease.

As more people flock to urban centers, the demand for homes in rural areas dwindles, leading to potential price drops. This trend is driven by the allure of city life, which offers more opportunities and conveniences.

Sources: Trading Economics, The Global Economy, Macrotrends

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9) Santo Domingo's property prices are set to stabilize as urban developments flood the market

Santo Domingo is buzzing with new residential and commercial developments thanks to its booming economy.

By mid-2023, the city saw a surge in construction, with the National Statistics Office highlighting that many areas suitable for building were actively being developed. This means more properties are hitting the market, giving buyers plenty of options.

Real estate agencies have observed a slowdown in price growth, with sales in the metropolitan region, including Santo Domingo, dropping from 1.9% to 0.5% in early 2023. This suggests the market is getting crowded with new projects, which is helping to keep prices steady.

As more developments pop up, the market saturation is expected to stabilize property prices in Santo Domingo. This is great news for potential buyers looking for a good deal.

Insiders say that the influx of new properties is making it a buyer’s market, where you might find more competitive pricing and better choices.

So, if you're considering buying property in Santo Domingo, now might be the perfect time to explore your options as the market adjusts to this new wave of developments.

Sources: Noriega Group, Dominican Today, Proyectos Inmobiliarios

10) Booming demand for single-story homes and retirement-friendly communities as the local population is aging

The aging population is reshaping the housing market in the Dominican Republic.

While the median age is still young at 28.0 years, it's expected to rise, leading to more demand for retirement-friendly communities. As people live longer, with life expectancy reaching 74.17 years in 2022, there's a growing need for homes that cater to older adults. Single-story homes are particularly appealing because they offer ease of mobility and accessibility, which are crucial for seniors.

The Dominican Republic is becoming a hotspot for retirees, with places like Luperon gaining popularity due to their affordable cost of living and serene environment. This influx of retirees is driving the demand for communities that offer amenities tailored to their needs.

Real estate market reports highlight a growing demand for senior housing, projecting a significant supply gap if development doesn't keep pace. This trend suggests that single-story homes will be in high demand as part of this senior housing market.

In the Dominican Republic, the appeal of single-story homes is not just about convenience; it's about creating a lifestyle that supports aging gracefully. The demand for these homes is expected to rise as more retirees seek out communities that offer both comfort and accessibility.

Sources: World Population Review, The Global Economy, Insider Monkey, NIC MAP Vision, Worldometers

11) Solar-powered homes face more demand as energy independence becomes the ultimate selling point

In the Dominican Republic, electricity costs have surged, making energy independence a hot topic for homeowners.

With power demand peaking at 3,662.27 megawatts in 2024, the country has seen a 10% jump in energy consumption. Yet, many areas still face frequent power outages due to outdated distribution systems, pushing people to consider more reliable options like solar power.

Solar energy is gaining traction, thanks in part to government incentives like tax breaks and feed-in tariffs. These policies have made solar installations more appealing for those looking to cut ties with the unreliable grid.

The Dominican Republic is seeing a boom in solar projects, with over 1,300 MW of solar photovoltaic projects currently under construction. This surge reflects a growing interest in solar solutions as a way to ensure consistent electricity supply.

By 2023, the country had 2.2 GW of total installed renewable energy capacity, with just over 1 GW coming from solar. This shift towards solar energy is not just about going green; it's about gaining energy independence and stability.

As energy independence becomes a selling point, solar-powered homes are likely to gain more interest. Homebuyers are increasingly looking for properties that offer reliable and sustainable energy solutions.

Sources: Dominican Today, List Solar, ESS News

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12) Coastal rental yields will go up as short-term rental platforms flood the market, attracting international visitors

Rental yields in coastal regions are on the rise as short-term rental platforms increasingly attract international visitors.

In the Dominican Republic, 10 million tourists visited in 2023, creating a booming market for short-term rentals in popular coastal spots. This influx of visitors is a golden opportunity for property owners looking to capitalize on the demand for vacation rentals.

Platforms like Airbnb have become incredibly popular, leading to a surge in short-term rental listings. In hotspots like Cabarete and Las Terrenas, beachfront rentals are in high demand, often enjoying high occupancy rates and glowing reviews. This strong demand is a key driver for increasing rental yields.

Short-term rentals generally command higher average daily rates compared to long-term leases. On the North Coast, luxury properties are especially lucrative, as the appetite for high-end accommodations allows owners to charge premium rates. This means substantial rental income and, consequently, higher yields.

For those considering investing, the potential for profit is significant. The combination of high tourist numbers and the popularity of short-term rentals makes coastal properties a smart choice. Rental yields are expected to continue climbing as more international visitors flock to these beautiful shores.

Sources: Travel Week, Airbnb, Jedek Investments

13) Remote work surge drives demand for homes with dedicated office spaces in the Dominican Republic

Remote work is reshaping how we think about home spaces, with 28% of employees worldwide working remotely in 2023.

This shift isn't just about convenience; it's about boosting productivity. Many companies have noticed that remote workers can be just as, if not more, productive than those in traditional office settings. This realization is pushing businesses to embrace remote work policies, which in turn is increasing the demand for homes with dedicated office spaces.

The home office furniture market is booming, reflecting this trend. In 2023, it was valued at USD 15 billion, and it's expected to grow even more by 2032. This growth highlights the importance of having functional and ergonomic office setups at home, driven by the rise in remote work.

Real estate trends are also shifting. There's a noticeable increase in demand for homes that can accommodate both living and working areas. As more people work from home, the need for dedicated office spaces has become more pronounced, influencing how new properties are designed and built.

Architectural designs are evolving to meet this demand, with a focus on integrating home office spaces into new developments. This trend is not just about adding a desk in a corner; it's about creating a space that supports productivity and comfort, reflecting the changing needs of today's workforce.

Sources: Splashtop, GlobeNewswire, JoinGenius

14) Booming middle class set to skyrocket demand for mid-range homes with top-notch amenities

The Dominican Republic's rising middle class is fueling demand for mid-range homes with amenities.

In recent years, the country's economy has been on a roll, tripling the regional average growth. This boom has lifted millions out of poverty, swelling the ranks of the middle class, which now outnumbers the poor. As people flock to cities for better jobs and services, the need for urban housing is skyrocketing.

Urbanization is on the rise, and with it, more people are getting mortgages and home loans. The process is pretty straightforward, taking about 4 to 8 weeks, with interest rates between 8% and 13%. This makes home buying more accessible for middle-income families.

People are also looking for gated communities that offer security and amenities like parks and community centers. These features are a big draw for the middle class. The government is pitching in too, investing in infrastructure and public services to support these developments.

Consumer preferences are shifting towards secure living environments, and the demand for such communities is noticeable. These areas often come with perks like security and recreational spaces, which are highly attractive to the middle class.

With the government's backing in infrastructure, these residential projects are becoming more viable. This support is crucial as it helps create the kind of living spaces that the middle class is eager to invest in.

Sources: World Bank, Kredium, World Bank Document

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15) Punta Cana Airport expansion skyrockets housing demand in nearby areas!

The expansions at Punta Cana International Airport are driving up housing demand in nearby areas.

In 2024, the airport experienced a 10.2% increase in stopover arrivals, welcoming over 2.6 million non-resident visitors. This surge shows a growing interest in the region, often leading to more people considering longer stays or even relocating, which naturally boosts housing demand.

The expansion of Terminal B in 2023, backed by an $80 million investment, is set to handle 3 million passengers. Such infrastructure developments typically draw in more tourists and investors, sparking a real estate boom. This pattern is common in other tourist hotspots, hinting at a similar trend for Punta Cana.

Tourism in the area is also on the rise, with a 7.5% increase in tourists in October 2024 compared to the previous year. This uptick is a strong sign of growing housing demand, as more visitors and potential residents are attracted to the area.

The influx of expatriates and retirees is further fueling this demand, making Punta Cana a competitive market for buyers and renters. The area's appeal is undeniable, with its beautiful beaches and vibrant culture drawing people from all over.

As more people flock to Punta Cana, the local real estate market is becoming increasingly dynamic, offering a range of opportunities for those looking to invest or settle down. The airport's expansion is a key factor in this growth, making it an exciting time for the region.

Sources: JAC, Tourism Analytics, The Agency DR