Real estate is the top investment choice amongst foreigners investing in the Dominican Republic. Most of these investors are looking for short-term rental cash flow.
While some property owners try to manage their rental unit independently, you should hire a management company to take care of this on your behalf – especially if you will only be in the Dominican Republic part-time. The 15% to 25% management fee is well worth your peace of mind.
That said, you want to have some base knowledge about short-term rentals to intelligently interact and consult with your property manager about running your unit.
You and your manager should discuss these five points before renting out your unit:
1. Rental Platforms – Several rental platforms exist, such as VRBO and Booking.com, but Airbnb is the most popular in the Dominican Republic. Say you want to list your property on multiple platforms. In that case, you’ll need to invest in a synchronized calendar system to prevent double bookings, which will be an added expense. But, with that system, you reduce the possibility of hefty cancellation fees from the booking platform for canceling a reservation.
2. Rental Rate – Before setting your rental rate, you and your property manager should review the average rates for similar units in your market, so you’ll have a reasonable baseline price to start.
3. Testing – Before renting the unit out, it’s a good idea for you or the property manager to stay a night or two to ensure it’s ready to go. How’s the internet speed? Does the water get hot enough in the shower? Are the faucets functioning correctly?
4. Maintenance Days – The goal is 100% occupancy; however, experienced property managers advise blocking three or four days out of the month for unit maintenance. You’ll want to do monthly checks and maintenance on your AC units and washer and dryer. In some months, you may need to repair or paint a wall.
5. Pet Friendly or Not – Pet-friendly units tend to have higher occupancy rates, so it could make sense for you. Your policy must be clear that guests are responsible for any additional cleaning fees or any repairs for possible damage caused by their pets.
It is essential to approach the management of your rental property with due diligence and strategy to maximize its success. Actively engage with your property manager on key topics like platform choice, pricing strategies, testing, maintenance schedules, and pet policies to ensure your unit is competitively positioned in the market.
_________________________________________
Maria Abreu is the CEO and Managing Attorney of Abreu & Associates, a law firm practicing exclusively in Dominican Republic Immigration and Nationality law. She is also the founder of Retire and Invest DR. This organization hosts conference events for foreigners interested in living, retiring, and investing in the DR. You can contact Maria at: mabreu@abreuimmigration.com.