The 5 Things That Go Wrong Most Often with Dominican Republic Property Purchases

1. CONFOTUR Verification Failures

How it happens

CONFOTUR (Law 158-01) certification is the primary financial incentive for many Canadian buyers in the Dominican Republic — the 15-year property tax exemption, the VAT/ITBIS exemption on rental income, and the import duty relief on furnishings represent real ongoing savings that can justify a price premium of 10–20% over non-certified properties. The problem: buyers frequently rely on developer marketing materials or agent representations that a development is 'CONFOTUR certified' without independently verifying the current certification status through the Ministry of Tourism.

What can go wrong: a development that received CONFOTUR certification at launch in 2015 may have had specific phases certified but not others; the certification may have lapsed if the developer failed to comply with annual maintenance requirements; individual units within a large development may not all carry the same certification status; or in some cases, the marketing materials reference CONFOTUR status that was never formally obtained at all.

Prevention

Require the developer to provide the official CONFOTUR certificate number and the MITUR resolution number. Your independent Dominican attorney then verifies this directly with MITUR — a standard due diligence step that takes 2–5 business days. Confirm: that the certification is current, that it covers the specific unit or phase you're purchasing, and that the remaining certification period is disclosed clearly. Build your financial model with and without CONFOTUR benefits — if the investment doesn't work without them, the certification status is load-bearing and requires zero-ambiguity verification.

If it happens anyway

If you discover post-purchase that CONFOTUR certification was misrepresented, you have a potential misrepresentation claim against the developer under Dominican civil law. Retaining a Dominican attorney immediately is essential — the strength of this claim depends heavily on what representations were made in writing in your purchase agreement and marketing materials. Include future tax liability in any settlement demand: the uncovered IPI liability over the years you'll own the property is a calculable number that should anchor the claim.

2. Title Disputes — The Torrens System Is Relatively New

How it happens

The Dominican Republic implemented its current Torrens-based title registration system through the Ley de Registro Inmobiliario (No. 108-05, and its 2007 reform), which replaced an older, less reliable deed registration system. While the Torrens system theoretically provides indefeasible title, the transition from the old system was imperfect: some properties have never been fully surveyed, some historical transactions from before the Torrens implementation were not properly converted, and competing claims that predated the registry sometimes survive as unresolved adverse entries (anotaciones) on the title.

Title disputes in the DR arise most often in: properties acquired through informal subdivision of larger parcels without formal surveying; properties in older urban neighborhoods where historical occupancy patterns don't match the registered boundaries; and properties where the certificado de título number shown in marketing materials refers to a parent parcel that hasn't been formally subdivided into the specific unit being sold.

Prevention

A full title search at the Registro de Títulos is mandatory — not optional, not delegatable to the developer's attorney, and not replaceable by a developer's assurance. The search should confirm: the certificado de título number exists and corresponds to the specific property, there are no anotaciones (adverse claims), the seller is the registered titleholder, there are no mortgages or liens attached, and the property's registered dimensions match the physical property. For any property without a recent agrimensor survey, commission one before closing — a licensed DR surveyor (agrimensor) physically verifies the boundaries. Cost: $500–$1,500 USD. Essential.

If it happens anyway

If a title dispute surfaces post-closing, you are in Dominican civil court with your attorney making the case for your registered title against the competing claim. The Torrens system generally favors registered holders over unregistered claimants — but the resolution process is slow and expensive. Your attorney will file for a resolution at the Tribunal de Tierras. Expected timeline: 18 months to 4 years. Prevention is orders of magnitude more cost-effective than this process.

3. Developer Delays: 12–24 Months Is Common

How it happens

Pre-construction purchases in the Dominican Republic — which represent a significant share of the foreign buyer market, particularly in Punta Cana, Bávaro, Las Terrenas, and Cap Cana — carry delivery timeline risk that is structural and widely documented. Delivery delays of 12–24 months beyond the stated date are common. During the 2020–2022 COVID period, delays of 24–36 months occurred at numerous projects. Causes include: supply chain disruptions for construction materials, permit and approval backlogs at municipal and national agencies, financing delays for the developer, changes in project scope or design, and in some cases, a developer who oversold units and underestimated construction costs.

The damage to buyers is not just the delay itself — it's the carrying cost during the delay. A buyer making monthly installment payments on a unit they cannot yet rent out, while also paying rent somewhere else, is in a negative cash flow position for the entire delay period. Contracts that have no penalty provision for late delivery leave buyers with no financial recourse — just the option to wait.

Prevention

Before signing: verify the developer has delivered at least two comparable completed projects. Visit at least one — physically, in person — and speak with buyers who purchased in those projects about the delivery experience. For the purchase agreement, require your attorney to negotiate: (1) milestone-based payment schedule tied to verified construction completion percentages rather than calendar dates; (2) explicit delivery date with a meaningful per-month late delivery penalty (1–2% of purchase price per month of delay is a reasonable negotiating position); and (3) a developer insolvency provision specifying what happens to deposits if the developer cannot complete the project.

If it happens anyway

If you have penalty provisions, invoke them in writing through your attorney — immediately at the first delay milestone, not after 18 months of waiting. If the project appears stalled, your attorney should assess whether the developer has committed a material breach sufficient to support a judicial claim. Document every communication with the developer from this point forward. If other buyers in the same project are experiencing the same issues, coordinate — a collective legal action has more leverage than individual claims.

4. Squatter and Invasion Risk on Vacant Land

How it happens

The Dominican Republic has a documented and significant problem with invasión — organized or informal squatter establishment on privately owned but unattended vacant land. This is not random: in some cases, it is semi-organized by local political or community figures who direct families to occupy unused land. Once squatters have established visible, continuous presence and have been tolerated without legal challenge for a period, they can assert possession claims under Dominican civil law that require formal judicial proceedings to resolve.

Canadian buyers who purchase land with plans to build 'in a few years' — and leave the parcel unattended, unfenced, and unoccupied in the interim — are the highest-risk profile for this problem. A parcel that looks pristine on a satellite image when you bought it can have 15–20 structures on it within 18 months if it is left completely unattended in a community where land pressure is high.

Prevention

Secure any vacant land immediately at purchase: perimeter fencing, locked access points, and a local caretaker (cuidador) who is compensated to visit and maintain the site regularly. Begin any development plans as soon as feasible — an active construction site is not a squatter target. If you cannot develop within 12–18 months, budget for ongoing security costs as a carrying cost of land ownership. If you have no plan to develop within 3 years, reconsider whether vacant land in the DR is the right asset for your situation.

If it happens anyway

Retain a Dominican attorney immediately and do not attempt to remove squatters physically — this is both legally inadvisable and dangerous. The legal process requires filing a desalojo (eviction) proceeding at the appropriate Dominican court, presenting your certificado de título, and obtaining a court order for removal. Timeline: 2–5 years in most cases. The cost in legal fees and lost use of the land is substantial. If squatters have been present long enough to have constructed permanent structures, the case becomes more complex. Early action — the moment you become aware of any unauthorized presence — is dramatically better than delayed action.

5. Currency Risk — DOP Depreciates ~3%/Year Against USD

How it happens

The Dominican peso has depreciated approximately 3% per year on average against the US dollar over the past decade — from roughly RD$43/USD in 2014 to approximately RD$60/USD in 2024–2025. This is a structural, long-run trend driven by the DR's higher inflation rate relative to the United States. For Canadian buyers, the currency picture has two layers: CAD/USD and USD/DOP. Your property asset is USD-priced; your purchasing-power exposure to DOP is on operating costs.

The problem most commonly surfaces when buyers price their rental income in Dominican pesos rather than USD. A unit that generates RD$50,000/month in rent in 2020 generated approximately USD $860/month at the 2020 exchange rate. By 2025, that same RD$50,000 nominal rent — even if it grew slightly — might be generating USD $850/month at the higher DOP/USD rate. Without USD-denominated rental pricing, the long-run depreciation erodes your yield in real terms.

Prevention

Price all rental income in USD — most DR vacation rental platforms price in USD, which handles this automatically. Maintain operating reserves in a USD account rather than a DOP account. When modeling your investment return, use a DOP depreciation assumption of 3–4% per year for any DOP-denominated costs, and plan for your CAD/USD exposure separately (your income is in CAD; your asset and expenses are in USD). Use an FX specialist for large conversions — your bank's CAD/USD spread can cost 2–3%, which is significant on large transfers. See our financing property abroad guide for FX specialist recommendations.

If it happens anyway

DOP depreciation is not a discrete event you can respond to — it's an ongoing structural reality. If you're already holding DOP-denominated rental income, convert to USD pricing at the next lease renewal. If you have significant DOP-denominated savings in a Dominican bank account, convert to USD regularly using the local USD account option most major Dominican banks offer (Banco Popular, Banco BHD León, and Scotiabank DR all offer USD accounts). There is no retroactive mitigation — only ongoing management.

Risk Prevention Checklist: Summary Table

Use this table as a due diligence checklist before placing any deposit on a Dominican Republic property.