Punta Cana, Dominican Republic or Tulum, Mexico?

Question

Hey y’all, strongly considering buying my first airbnb outside the US. I am looking at both the Dominican Republic and Mexico. Was curious if anyone has invested in these areas and how your experience was investing outside of a country that you live in? The houses I can get in both of these locations are mind blowing to me for the price. Thanks in advance!

Mike Lambert · Answer

Hi Lexi,

Houses are mind-blowing cheap in Detroit compared to Miami. Yet, Miami has been by far the better investment. The question is also how much rental income you're going to be able to make. In Punta Cana, you'll have tho contend with the fact that most visitors want to stay in all-inclusive resorts and you can't compete against that while, in Tulum, you might have to contend with overbuilding of epic proportions and the ensuing competition. My advice to you: use Airdna to try to estimate future profitability. You might be in for a surprise.

@Sebastian Papworth the Dominican Republic offer some limited tax incentives but they are specific to some properties and you do have to pay taxes there. I don't know who you talked to but realtors in the Dominican Republic are unlicensed and unregulated so everybody and their mother can become one and they do. There are some good and professional realtors there but take what you're told by them at face value at your own peril. Moreover, even if it was true, foreigners have to pay taxes in their own country anyway so that would be irrelevant.

Sebastian Papworth · Answer

Hello Lexi,As a seasoned realtor, investor, and developer in the Riviera Maya, I don't have direct experience in Punta Cana, but I've reached out to colleagues with brokerage firms there for insights. Punta Cana does offer the advantage of not having to pay taxes, but keep in mind it receives less tourism compared to Mexico.In Tulum, the market is becoming competitive, especially in standard studio, 1 & 2 bedrooms. However, there are unique penthouses, gardens, and villas with distinctive designs that are generating double-digit returns. Depending on your budget, if you're open to exploring new and promising opportunities under $400K, there's also an emerging market that opened up due to the Mayan train and the new tulum airport that is worth considering.Greetings from the Mexican Caribbean!