Key takeaways
- Gross yield is annual rent divided by purchase price; it ignores every running cost.
- Net yield deducts service charges, vacancy and letting fees, and is the figure that reflects your actual return.
- In Dubai the biggest drag on net yield is usually the service charge, which varies widely between buildings.
- The example below uses a JVC studio: 655 sq ft, AED 637,000, AED 48,000 a year in rent and a AED 12 per sq ft service charge. Change any figure to model your own.
How the calculator works
Gross yield is the annual rent divided by the purchase price. It is the headline number most listings quote, and it is useful for comparing areas, but it ignores every cost of owning and letting a property.
Net yield starts from the rent you actually collect after any vacant weeks, then deducts the annual service charge (the rate per square foot multiplied by the unit size) and letting or management fees. The calculator shows net yield two ways: against the purchase price, and against your total cost including the Dubai Land Department’s 4% transfer fee and other purchase costs. The second figure is the more conservative measure of your return on cash invested.
What moves net yield in Dubai
Dubai has no annual property tax and no personal income tax on rental income, so the gap between gross and net yield is narrower than in most international markets. What remains is mainly the service charge, which is set per building and can differ significantly between neighbouring towers, along with vacancy between tenancies and any letting or management fees. Furnishing, maintenance and short-term rental costs are not included here and should be added if they apply to you.
For community-level rents and yields, see our JVC area guide and Dubai Islands area guide, and our monthly market pulse posts on the news page. For the wider investment picture, including tax and the buying process, see Invest in Dubai.
Example: a JVC studio
The default figures model a studio of 655 sq ft at Xenia Residence, priced from AED 637,000 with an estimated service charge of AED 12 per sq ft, let at about AED 48,000 a year, in line with indicative JVC studio rents. On those assumptions the gross yield is about 7.5% and the net yield after service charges, two vacant weeks and a 5% letting fee is about 5.6% on the purchase price. Your own figures will differ with the unit, the rent achieved and how you let it.
Frequently asked questions
What is a good rental yield in Dubai?
Gross yields of 6–8% are typical for apartments in established mid-market communities such as Jumeirah Village Circle, while prime waterfront areas usually yield less. Net yield, after service charges, vacancy and fees, is the better measure of your actual return.
What is the difference between gross and net rental yield?
Gross yield is annual rent divided by purchase price. Net yield deducts running costs such as service charges, vacant periods and letting or management fees before dividing by the price or the total purchase cost.
Are service charges included in rent in Dubai?
No. Service charges are paid by the owner to the building’s owners association and are usually quoted in AED per square foot per year. They are one of the main differences between gross and net yield.
Is rental income taxed in Dubai?
The UAE does not levy personal income tax on rental income earned by individuals. Owners resident elsewhere may need to declare the income in their home country.