Are you interested in learning how to calculate the approximate profitability of your property in Punta Cana? You've come to the right place.

As real estate advisors, we must master all aspects of buying, selling, and renting properties so you have the real numbers and won't be misled when someone tries to sell to you. This is why WE DO NOT SELL; WE ADVISE OUR CLIENTS ON REAL ESTATE INVESTMENTS.

LET’S DO THE EXERCISE so you know how to analyze properties before investing:

Let’s assume you invested with us in a property with a purchase value of $175,000 USD in the pre-sale phase in Punta Cana. We deliver it to you now, and you can rent the property with a monthly income of $1,500 USD, which is the price range for this exercise.

Monthly Income
Gross Rental Income: $1,500 USD

Breakdown of Taxes and Expenses

1. Income Tax (ISR)
Rate: 27% on net rental income.
Permitted Deductions: Maintenance, repairs, management, insurance, among others.
Calculation: Let’s assume you have monthly deductions totaling $300 USD.
Net Income: $1,500 USD - $300 USD = $1,200 USD
Monthly ISR: 27% of $1,200 USD = $324 USD

2. Maintenance and Repair Expenses
Amount: $100 USD (assumed)

3. Management Expenses
Amount: $50 USD (assumed)

4. Property Insurance
Amount: $30 USD (assumed)

Final Monthly Expense Breakdown
Monthly ISR: $324 USD
Maintenance and Repairs: $100 USD
Management Expenses: $50 USD
Property Insurance: $30 USD
Total Monthly Expenses
Total: $324 USD + $100 USD + $50 USD + $30 USD = $504 USD

Final Net Income
Gross Rental Income: $1,500 USD
Total Expenses: $504 USD
Final Net Income: $1,500 USD - $504 USD = $996 USD

Summary
Gross Rental Income: $1,500 USD
Monthly Deductions (Maintenance, Repairs, Management, Insurance): $300 USD
Net Income (for ISR calculation): $1,200 USD
Income Tax (27%): $324 USD
Other Monthly Expenses (Maintenance, Management, Insurance): $180 USD
Final Net Income: $996 USD


This example shows that after paying taxes and considering maintenance, management, and insurance expenses, the net monthly income from renting the property would be $996 USD.

Once we have this crucial figure, you should look at the value of your property, which in this case was $175,000 USD, and if we analyze the final net income, it shows an approximate annual return of 7%.

IMPORTANT NOTE: This exercise is based on a long-term rental/fixed rental, which would be the lowest scenario. If we listed it on platforms like Airbnb, the profitability percentage would be much higher, but with this exercise, we now know the minimum we could generate from this property.

It is essential to note that these numbers are approximate and may vary depending on the specific conditions of the property and actual expenses.

Additionally, it is always recommended to consult a tax advisor for accurate and up-to-date information on tax obligations in the Dominican Republic.

WE DO NOT SELL PROPERTIES;
WE ADVISE ON REAL ESTATE INVESTMENTS
TOP ADVISER REAL ESTATE PUNTA CANA