Yield
Where the yields actually are: Dubai rental returns by community
Gross yield is a marketing number. Net yield — after service charges, voids, letting commission and management — is the number you live on, and it reorders the league table completely.
Dubai’s rental yields are genuinely high by international comparison — a function of strong net inward migration, a largely tenant population, and no annual property tax eating the income. But the figures quoted in advertising are almost always gross, and the gap between gross and net in Dubai is unusually wide because service charges here are unusually large.
Below is the arithmetic, then the communities.
How to calculate net yield properly
Start with the all-in cost, not the price. On a AED 1,500,000 apartment bought for cash, the all-in cost is around AED 1,595,000 once the 4 per cent transfer fee, commission and trustee fee are included. Then work down the income.
| Line | Example | Note |
|---|---|---|
| Annual rent | AED 105,000 | 7.0% gross on price |
| Service charges | –AED 18,400 | 1,150 sq ft at AED 16 / sq ft |
| Letting commission | –AED 5,250 | 5% of annual rent |
| Management | –AED 5,250 | 5% of rent, optional |
| Void allowance | –AED 8,750 | One month a year |
| Maintenance reserve | –AED 3,000 | Appliances, snagging, repaint |
| Net income | AED 64,350 | |
| Net yield | 4.03% | On the all-in cost of AED 1.595m |
A quoted 7 per cent became 4 per cent, and nothing dishonest happened — the costs are simply real. Change one input, the service charge, from AED 16 to AED 9 per square foot and the net yield rises to 4.5 per cent. That single line is worth more than the difference between most communities.
In Dubai, the service charge is not an operating detail. It is a third of your return.
Indicative yields by community
The table below gives broad gross ranges observed across 2026 listings and recorded transactions. Treat them as a starting point for a specific building, never as a forecast — the variation within any community is wider than the variation between communities.
| Community | Type | Indicative gross yield |
|---|---|---|
| Jumeirah Village Circle | Apartments | 7.0 – 8.5% |
| Dubai Sports City / Arjan | Apartments | 7.0 – 8.5% |
| International City / Discovery Gardens | Apartments | 7.5 – 9.0% |
| Dubai Silicon Oasis | Apartments | 7.0 – 8.0% |
| Business Bay | Apartments | 6.0 – 7.5% |
| Dubai Marina / JBR | Apartments | 5.5 – 7.0% |
| Jumeirah Lake Towers | Apartments | 6.0 – 7.5% |
| Downtown Dubai | Apartments | 5.0 – 6.5% |
| Dubai Hills Estate | Apartments | 5.5 – 6.5% |
| Dubai Hills Estate | Villas / townhouses | 4.5 – 5.5% |
| Arabian Ranches / Mudon | Villas / townhouses | 4.5 – 5.5% |
| Palm Jumeirah | Apartments | 4.5 – 6.0% |
| Palm Jumeirah | Villas | 3.0 – 4.5% |
| Emirates Hills / Jumeirah Bay | Villas | 2.0 – 3.5% |
Why the top of that table is not the right answer
The highest gross yields in Dubai cluster in the same places for the same reasons, and each reason is also a risk.
- Supply. Communities with the highest yields usually have the largest handover pipelines. New stock competes directly with yours on rent, and the tenant moves for a free month.
- Tenant churn. Lower rents correlate with shorter tenancies, which means more voids and more letting commissions — both of which the gross figure ignores.
- Service charge shock. Some high-yield towers have the highest charges per square foot in the city once the chiller and lift replacement reserves are properly funded.
- Liquidity. When you sell, a prime unit in a known building finds a buyer at a predictable discount to the last recorded transaction. A unit in a 900-apartment mid-market tower with forty others listed does not.
- Capital growth. Over the long run, Dubai’s prime districts have carried most of the capital appreciation. Yield and growth are usually a trade, and the trade is the decision.
What a serious buyer checks before the yield
- The service charge per square foot for that specific building, from the Mollak system, and the trend over three years.
- Whether district cooling is on a capacity charge — a fixed annual bill you pay even when the unit is empty.
- The recorded transactions for that building in the DLD register over the last twelve months, not the asking prices.
- How many units in the building are currently listed to let. Ten listings in a 100-unit tower is a rent problem, not a yield.
- The current rent against the RERA rental index, which determines whether you may legally raise it. That rule is here.
Short-let: higher ceiling, different business
Holiday-home letting under a DTCM permit can lift gross revenue meaningfully in Marina, JBR, Downtown and on the Palm. It also introduces a permit, tourism fees, furnishing capital, 20 to 25 per cent management fees, utilities you now pay, and seasonality — Dubai’s summer is genuinely slow. Net outcomes are frequently similar to a good long let, with more operational risk and more upside in a strong season. It is a business, not a yield.
If you want one sentence: buy the building with the defensible service charge and the deep tenant demand, in the community you can still sell in, and accept a 5 per cent net yield over a quoted 8.
