Rental yields in Dubai are some of the highest in any major global market. They are also the most commonly overstated by about 150 basis points.
Rental yield is annual rental income as a percentage of property value — gross when quoted against total rent, net when quoted against rent after operating expenses. Dubai’s gross rental yields across ready-market segments run roughly: JVC 6.5-8%, Business Bay 5.5-7%, Dubai Marina 5-6.5%, Downtown 4.5-6%, Palm Jumeirah 3.5-5%. Net yields are 150-250 basis points lower depending on service charge intensity.
What distorts the reported yields: the denominator. Listings quote yield against the asking price, not the transaction price. Asking is typically 5-8% above where deals actually close in the secondary market. Quote the same rent against the real transaction price and the yield climbs; the agent doesn’t tell the next buyer this math.
On a specific Business Bay 1BR I tracked last year — AED 1.42M transaction price, AED 88k rent — gross yield was 6.2%. Net after service charge, management, and vacancy came in at 4.6%.
The number that helps you decide: net yield against the ten-year Treasury spread. That’s the real-asset premium.
Related: Gross Yield, Net Yield, Cash Flow, ROI.
Run the numbers on a real Dubai unit
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