Puerto Rico’s real estate market is booming as high-net-worth individuals flock to the island for significant tax breaks under Act 60. Home values rose 11.6% in Q1 2025, the highest nationwide. Short-term vacation rentals have skyrocketed, with listings increasing from 1,000 in 2014 to over 25,000 in 2023.

The legislation offers residents a 4% corporate tax rate and exempts them from U.S. federal capital gains tax if they spend at least 183 days a year on the island. Figures show a 22% surge in home values in the final quarter of 2024, the largest annual gain recorded by the FHFA since 1995.

Wealthy individuals in finance, cryptocurrency, and tech, such as John Paulson and Michael Terpin, are among those taking advantage of Act 60. The island’s transformation is part of a broader trend, with a record-breaking 142,000 millionaires expected to relocate internationally in 2025, according to the Henley Private Wealth Migration Report.

Short-term rentals as a share of housing units have led to a 23% rise in home prices and a 7% increase in median rents in Puerto Rico. The Hispanic Federation has recommended that vacation rentals register as businesses and that the current 7% room tax be raised to between 9% and 11% to balance tourism opportunities with community needs.

Read more at Yahoo Finance: Millionaires Race To Beat Tax Deadline, Locals Sound Alarm