The new law transforms the rental market after 70 years of outdated regulations. Clear limits on deposits, the option of using banks, and new rent adjustment rules define the future of real estate, but leave gaps that professionals must anticipate while awaiting the publication of the regulations that will clarify the final rules.
After 70 years of waiting, it's finally here. Law 85-25 has just changed the rules of the game for all of us in the Dominican real estate sector. The question is no longer whether it will affect you, but how prepared you are to navigate this new territory.
Agents who master these regulations will build lasting competitive advantages, while those who ignore them will lose relevance in the market.
Law 85-25 on Real Estate Rentals and Evictions has been enacted (Official Gazette, August 14, 2025). It opens a new chapter after more than seven decades of outdated legislation.
The advances we were all waiting for
Clear security deposits (Art. 13)
For residential properties, landlords can only require up to two months' rent as a security deposit. For commercial properties, the amount will be agreed upon by both parties. Finally, we have clear limits that protect tenants without leaving landlords unprotected.
Banking and interest rates (Art. 15)
The deposit can be placed in Banreservas or Banco Agrícola, and will generate interest in favor of the tenant. This right, established by Law 4314, is now being modernized in its application.
Legal fees and expenses (Art. 7)
The law clearly states: "The brokerage commission will be paid by the party who contracts it" and "the legal expenses on the occasion of the rental or lease agreement will be in equal parts borne by the owner or lessor and the tenant or lessee.".
Adjustments with limits (Art. 8)
Unless otherwise agreed, rent increases for residential properties cannot exceed 10% annually. This strikes a balance between protecting tenants and protecting landlords' rights in the face of economic fluctuations. In this respect, the law formalizes what many considered a reasonable market practice.
The challenges that no one is discussing
The emptiness of the first month
The law does not clarify whether the first month's deposit is included in the two-month deposit limit. Until regulations clarify this distinction, agents and lawyers must establish clear criteria in their contracts to avoid future disputes in the market.
Collaboration between colleagues is in danger
The principle of "whoever hires pays" could be used to limit the splitting of commissions, weakening the cooperation that characterizes the best real estate agents.
The contradiction in legal expenses
The obligation to divide legal expenses contradicts Article 1593 of the Civil Code. This regulatory inconsistency will require judicial interpretation, which may generate uncertainty until it is resolved.
Your immediate action plan
Because ignoring this law is not an option, here's your strategy:
This week:
- Review existing contracts and identify which ones do not meet the new requirements
- Educate your clients from the first meeting about deposits, fees and adjustments
- It establishes internal protocols that unify criteria in fees and collaboration
This month:
- It includes preventative clauses to avoid conflicts regarding prepayment, deposits, or adjustments
- Get trained on the technical aspects of the new regulations, as various institutions in the sector are organizing training sessions to stay up to date
Remember: An agent who does not master these regulations will lose credibility with every client they serve.
The moment of truth
The era of Law 85-25 has begun. The legal consolidation process will continue with the publication of the regulations, which will define the specific procedures and resolve current ambiguities
The Dominican real estate market urgently needed this update to further boost real estate investment . And the agents who master it first will be the ones who build the strongest careers.
Our commitment as professionals is not to complain about the change, but to turn this new legal framework into our competitive advantage.
Because legal certainty, more than a principle, is the master key that underpins every real estate investment in the Dominican Republic. And that key now has new locks that only trained professionals can open.
Your next step is simple but vital: This week, ask yourself: How many of your current contracts comply with the new requirements of Law 85-25? If you can't answer with absolute certainty, you have work to do.
Your professional credibility depends on it. The industry needs skilled professionals who raise the bar for everyone, and the market rewards those who anticipate change rather than react to it.
