Dubai: The “Net Yield” Truth

Why Gross Rent Lies and Smart Investors Calculate Backwards

Dubai is a market where listings often look incredible on paper. High rents, modern buildings, strong demand. But many buyers get caught by the most common trap: they fall in love with the gross number.

Gross rent is the headline. Net yield is the reality.

The 6 costs that quietly change everything

To understand your true return, you need to subtract what ownership actually costs you.

Service charges

This is often the biggest “silent cost” in Dubai. Two identical units can produce very different net returns because one building is simply more expensive to operate.

Vacancy and tenant turnover

Even a strong unit can sit empty between tenants. A conservative plan assumes gaps happen.

Maintenance and wear

Air conditioning, appliances, repainting, deep cleaning. Dubai units age fast when they’re rented actively.

Management fees

If you’re not living in Dubai full-time, management is not optional. It’s part of your business model.

Furnishing and setup

A rental-ready unit needs to be livable, not just photogenic. Many buyers underestimate the setup cost.

Transaction costs

Registration and admin fees at purchase matter. They change your real entry price, which changes your return.

The simple method professionals use

Instead of asking “How much rent can I get?” start with:

What is my realistic net rent after costs

What is my total entry cost including fees and setup

What return do I get in a conservative scenario, not a perfect one

If the deal only works when everything goes perfectly, it’s not an investment, it’s hope.

The Dubai advantage

Dubai can still be an excellent cash-flow market when you buy investor-grade assets, meaning easy layouts, strong access, and buildings with efficient cost structures. The best purchases are the ones that stay rentable even when competition increases.