In recent years, many investors with real estate assets in Spain have begun to question whether their capital is really working at the pace it deserves. The maturity of the Spanish market, increasing regulatory pressure, and profitability that no longer surprises have awakened the need to look further afield. In this article, I share a direct and clear comparison between the real estate environment in Spain and the opportunities currently offered in the Dominican Republic, with concrete data and a realistic perspective.
Profitability: Where does your investment yield the most?
In Spain, the gross rental profitability is around 5-6% on average, with highs of 8-10% in very specific, high-turnover areas. But even in these cases, tax burdens, rent control regulations, and maintenance costs can significantly reduce this margin.
In contrast, in the Dominican Republic - and especially in areas with high tourist demand such as Punta Cana - Gross returns range between 8% and 12%, with a much more competitive acquisition cost and tax exemptions applicable in certain tourist developments such as Larimar City. capital gain (Real estate appreciation) is also significantly more dynamic in the Caribbean country, driven by the growth of tourism, the arrival of foreign capital, and the continued development of infrastructure.
Legal stability: certainties versus uncertainties
Spain has a solid legal framework, but in the real estate sector, we have seen a growing trend toward restrictive regulation of the rental market: Limitations on rent increases, threats of price controls, or increasing taxes on second homes or tourist apartmentsThis creates a sense of legal uncertainty that can be discouraging for investors.
In the Dominican Republic, the legal framework that protects private property is clear, stable and favorable to foreign investorsThere is no discrimination between nationals and foreigners when it comes to purchasing property. Furthermore, laws such as CONFOTUR (Law 158-01) They provide very attractive incentives for tourism projects: Exemption from IPI (equivalent to IBI), rental income tax, and real estate transfer tax for up to 15 years.
Taxation: The Silent Impact on Your Profitability
One of the greatest obstacles to net returns in Spain is the tax burden. Property taxes, rental income taxes, and capital gains taxes, in addition to local and regional taxes, significantly reduce investors' profit margins.
In the Dominican Republic, thanks to the Tax exemptions available on projects approved by CONFOTUR, an investor can enjoy a much lighter tax horizon. This translates into more net profitability from day one.
Economic context: two speeds, two realities
The Spanish economy is progressing at a contained pace, with GDP growth projections of around 1,5–2% per year, and with a real estate market that shows signs of slowing down in some areas.
By contrast, The Dominican economy grew by 5% in 2024, with stable forecasts for the coming years. It is one of the most dynamic economies in Latin America, strongly supported by tourism, foreign investment, and a growing middle class. In this context, demand for housing (both tourist and residential) is not only stable, but is growing strongly.
Geographic diversification: insurance against uncertainty
Investing in a single country, no matter how safe it may seem, is taking a risk. concentration riskIf Spain introduces new tax or regulatory measures that penalize real estate ownership, or if the market stagnates, all capital will be exposed.
Diversify geographically—for example, by combining assets in Spain with investments in the Dominican Republic— reduces that risk and offers strategic coverageIn a globalized world, having a piece of heritage outside the local environment isn't an extravagance: it's a smart decision.
Conclusion: Time to look at the Caribbean with different eyes
The question is no longer whether the Dominican Republic is a viable option for the Spanish investor, but if you can afford not to consider it seriouslyWith higher returns, a more friendly legal and tax environment, and a growing economy, the Caribbean country offers conditions that are difficult to find in Europe today.
And within that context, Larimar City & Resort It represents a unique opportunity: a first-class urban development, promoted by a listed Spanish company, with all the guarantees of transparency, quality, and future ambition.
If you are considering new options to protect and grow your investment, it is best to schedule an appointment with our advisors by writing to info@larimarcity.comWe're here to help you make informed, forward-thinking, and pressure-free decisions.
By Macarena Perona
Assistant to Director
CLERHP