A yield is annual rent as a share of the property's price. Gross yield takes the rent before any cost. Net yield takes it after the costs of owning and letting the property — service charges, cooling, management, insurance, a realistic allowance for vacancy, and minor maintenance — and it is the number that arrives in your account. Most Dubai listings quote gross. Most buyers compare gross. Almost nobody banks it.
This matters more here than in many markets because the costs are large relative to the rent. Service charges alone can take a fifth of the gross rent in an amenity-heavy tower. A community with a high headline yield is often a community with high running costs, so the gap between the number quoted and the number received is widest exactly where the marketing is loudest.
The working
Take a 1,000-square-foot apartment bought for AED 1,500,000 and let for AED 95,000 a year. Gross yield: 95,000 divided by 1,500,000, or 6.3%. Now the deductions, using figures typical of a mid-rise tower today: service charge at AED 18 per square foot, AED 18,000; management at 5% of rent, AED 4,750; three weeks of vacancy a year, about AED 5,500 of rent not received; insurance and minor maintenance, say AED 2,500. Net income: 95,000 less 30,750, or AED 64,250. Net yield: 64,250 divided by 1,500,000, or 4.3%.
Two full points have gone, and nothing unusual happened. Add district cooling capacity charges billed to the owner, a leasing fee when the tenant changes, or a month's void between tenancies in a new district, and the figure drifts toward the high threes.
The gap between gross and net is not a rounding error. It is the cost of owning the building you bought.
Where the gap is widest
From our own managed portfolio and registered data, the gap is widest in high-yield, high-supply apartment districts: Jumeirah Village Circle has advertised around 8.2% and realised closer to 6.1%; Dubai Marina around 6.4% advertised and 5.0% realised; Dubai Hills apartments around 5.6% and 4.8%. The pattern is consistent: the higher the headline, the more of it is consumed by charges, voids and turnover. A realised 6.1% in JVC is still a good return. It is not 8.2%.
What to use for each input
- Rent: registered tenancies for the same unit type in the same building, from Ejari data or the RERA rental index — not the listing price, and not the developer's projection.
- Service charge: two years of actual invoices for a ready property; for off-plan, what comparable delivered buildings by the same developer actually pay, not the launch projection.
- Vacancy: two to four weeks a year for a well-located apartment with a long-term tenant; more in a new district, and considerably more for short-term letting.
- Management: around 5% of rent for a long-term let; 15% to 25% for short-term.
Each of those inputs is checkable before you buy, and each is more reliable than the figure in a listing. Where a seller or a developer cannot or will not provide one, we model the conservative end of the range and say so. A yield built on an input nobody can substantiate is not a yield; it is a hope with a percentage sign.
Yield is not the return
Net yield is income. Total return adds the change in the property's value, and in Dubai the two often pull in opposite directions: the highest-yielding districts have shown the slowest capital growth and the coast the reverse. A buyer who needs income should weight yield; a buyer who does not may rationally accept a 3% net yield on Palm Jumeirah for the liquidity and the scarcity. Neither is wrong. Comparing them on gross yield is.
Our yield calculator asks for all of the inputs above and shows gross and net side by side with the working. Use it on any property you are considering, and if the seller or the developer cannot give you the inputs, that is information too.