DR Short-Term Rentals Surge 226%, Reshaping Hotel Market

Caribbean · Property

DR short-term rentals have tripled in seven years, redrawing the Dominican Republic’s tourism map and piling pressure on traditional hotels. With nearly 57,000 properties now listed and regulators finally moving toward taxation and operating rules, the country’s lodging market is undergoing its most consequential shift in decades.

DR short-term rentals: A supply explosion that outpaced hotels

The numbers tell a blunt story. At the close of 2025, the Dominican Republic’s Ministry of Tourism (Mitur) counted 56,973 short-term rental properties, up from just 17,456 in 2018 – a 226.4 percent leap. Room inventory swelled even faster, climbing from 42,093 to 136,338 between 2018 and 2024, a 223.9 percent increase.

In 2023 alone, the sector added 20,316 new rooms. By February 2024, Mitur had already registered 47,474 properties and 117,049 rooms, marking an 18.76 percent year-on-year rise in listings. The pace shows no sign of cooling.

This expansion has tilted the balance of the country’s lodging supply. A widely cited study from the Dominican hotel and tourism association Asonahores reported that short-term rentals already accounted for 57.6 percent of national tourist accommodation in 2022. The figure has become a reference point in every regulatory debate since.

How guest behavior is changing

Tourist preferences are shifting visibly. According to central bank figures quoted in Dominican media, about 34 percent of the 8.86 million visitors who arrived in 2025 chose a short-term rental over a conventional hotel. That is roughly three million travelers opting for apartments, villas, and condos booked through platforms like Airbnb and Booking.

The appeal is straightforward for many foreigners and expat investors familiar with the Caribbean. Short-term rentals offer kitchens, multiple bedrooms, and residential neighborhoods – features that resorts in Punta Cana or Santo Domingo cannot always replicate at a comparable price. For digital nomads and families staying two weeks or longer, the economics often beat an all-inclusive.

Traditional hotels, particularly mid-range properties without strong brand loyalty, are feeling the squeeze. While luxury all-inclusives retain a firm grip on the package-tour segment, smaller urban and beach hotels compete directly with a fast-growing pool of private listings that operate under lighter regulatory and tax burdens.

The regulatory push after years of waiting

After more than four years of discussion, the Dominican government is finally drafting enforceable rules. From May 20 to July 22, 2026, Mitur opened a public consultation on a proposed short-term rental regulation. The draft aims to define licensing, safety standards, and reporting obligations for hosts – areas that until now have existed in a legal gray zone.

Taxation is moving on a parallel track. In May 2026, the Dominican tax authority (DGII) confirmed it was building a mechanism to collect up to 18 percent ITBIS – the country’s value-added tax – from digital platforms operating on Dominican soil. Airbnb and Booking are the primary targets. The government views the uncollected tax as a significant revenue leak, while hoteliers call it a basic matter of fair competition.

Asonahores has been the most vocal institutional voice pushing for a level playing field. The association argues that hotels carry heavy fixed costs, employ thousands formally, and pay full taxes, while many short-term rental operators contribute little to the fiscal system. The new rules, if enacted, would begin to close that gap.

What it means for foreign investors and expats

For the expat and foreign-investor community that follows the Dominican Republic, the short-term rental boom is both an opportunity and a warning. Coastal areas such as La Altagracia province – home to Punta Cana and Bávaro – have seen some of the fastest listing growth. Property managers and real estate firms now routinely market condos with projected Airbnb yields.

Yet the absence of clear rules has created risk. Investors who bought pre-construction units expecting unrestricted short-term rental income may face new licensing requirements, tax obligations, or even zoning limits once the regulation is finalized. The DGII’s ITBIS collection plan could trim net returns by up to 18 percent if platforms pass the cost to hosts or guests.

On the other hand, formalization could stabilize the market. Clear rules tend to attract institutional capital, improve guest safety, and reduce the risk of sudden crackdowns. Several Dominican real estate developers are already adapting, designing buildings with dedicated rental-management services and compliance infrastructure built in.

A structural change, not a fad

The Dominican Republic’s tourism volumes provide the underlying fuel. The country continues to post record visitor arrivals, and that sheer volume allows both hotels and short-term rentals to grow simultaneously. But the composition of lodging is undeniably shifting toward flexible, platform-based stays.

Industry analysts quoted in Dominican outlets describe the trend as a “silent revolution.” Unlike a sudden disruption, it has unfolded over seven years, accelerated by the pandemic-era preference for private spaces and then sustained by price-conscious travelers and remote workers.

If the 2026 regulation passes and the DGII activates its tax collection system, the market will enter a new phase – one where short-term rentals are no longer an informal alternative but a recognized, taxed, and supervised pillar of Dominican tourism. For hotels, that may level the field. For investors, it will rewrite the math.

Frequently Asked Questions

How fast are DR short-term rentals growing?

Registered short-term rental properties in the Dominican Republic grew from 17,456 in 2018 to 56,973 by the end of 2025, a 226.4 percent increase. Room inventory rose from 42,093 to 136,338 between 2018 and 2024.

What share of tourists now use short-term rentals instead of hotels?

According to central bank data cited in Dominican media, roughly 34 percent of the 8.86 million tourists who visited in 2025 stayed in short-term rentals rather than traditional hotels.

Is the Dominican government planning to tax Airbnb and similar platforms?

Yes. In May 2026, the Dominican tax authority (DGII) confirmed it is developing a mechanism to collect up to 18 percent ITBIS (value-added tax) from digital platforms such as Airbnb and Booking that operate in the country.