Tools
Yield calculator
Gross and net rental yield from a price, an expected rent, the service charge and the size — with the working shown, so you can see what sits between the advertised figure and the one you would bank.
Estimates only, not advice — figures currently in force; confirm with your advisor.
The property and the letting
Use the RERA rental index or recent Ejari-registered rents for the same unit type, not the listing price.
Apartment towers currently run around AED 12–28 per ft², villas AED 3–6. Ask for two years of actual invoices.
Typically 5% of annual rent for a long-term let; 15–25% for short-term management.
Realistic voids between tenancies and for maintenance. Two to four weeks a year is typical for a well-located apartment.
Insurance, minor maintenance, cooling capacity charges billed to the owner. Leave at zero if the tenant carries them.
Result
What the numbers mean
Gross yield is the rent divided by the price — the figure most listings quote. Net yield deducts the service charge, the management fee, a vacancy allowance and other owner costs, and is the only number worth comparing across properties. The working is shown line by line; change any input and both figures update.
- Gross yield
- 6.33%
- Rent ÷ price — the figure most listings quote.
- Net yield
- 4.48%
- 1.85 points below gross once the costs of owning are taken out — the figure to compare.
The working, AED a year
- Expected annual rentOn a price of AED 1,500,000
- AED 95,000
- less vacancy allowance3 weeks a year without a tenant
- −AED 5,481
- Rent collected
- AED 89,519
- less service chargeAED 18 per ft² × 850 ft²
- −AED 15,300
- less property management5% of rent collected
- −AED 4,476
- less other owner costsInsurance, minor maintenance, owner-billed charges
- −AED 2,500
- Net annual income÷ AED 1,500,000 = 4.48%
- AED 67,243
- Gross yield6.33%
- Net yield4.48%
Most marketing quotes the first bar and calls it yield. The second is what reaches your account before tax and finance.
Gross = rent ÷ price. Net = (rent × occupied share − service charge × size − management − other costs) ÷ price. Purchase costs are not included in the denominator; the cost-of-buying tool has them.
Estimates only, not advice
An estimate, not advice. Yields depend on the rent actually achieved, the service charge actually invoiced and the voids actually experienced; none of those is known in advance. Figures from developers or listings are projections until a tenancy is registered. Past yields in a community do not set future ones.
Keep this result
The working
How this is worked out
Gross yield is the expected annual rent divided by the purchase price. It is the number on almost every listing and in almost every developer projection, because it is simple, flattering and needs no knowledge of the building. It is not wrong; it is incomplete.
Net yield starts from the same rent and takes out what owning the property costs each year before the money reaches you. The working in the panel is, line by line:
- Rent collected. The expected rent reduced by the vacancy allowance — the weeks a year without a tenant, between tenancies and for maintenance. Two to four weeks is realistic for a well-located apartment; zero is not.
- Service charge. The rate per square foot multiplied by the size. It is set annually against a RERA-approved budget and invoiced to the owner whether or not the unit is let. This is the deduction most buyers forget to model and the one that varies most between buildings.
- Management. A percentage of the rent collected, typically 5% for a long-term let under management; short-term letting runs far higher and has its own cost structure this tool does not model.
- Other owner costs. Building insurance, minor maintenance and any cooling capacity or owner-billed charges. Leave it at zero only if the tenancy genuinely places them on the tenant.
Net annual income is the rent collected less those three deductions; net yield is that income divided by the price. Purchase costs — the transfer fee, registration, agency — are not added to the price here, so the yield is comparable with the way the market states it; the cost-of-buying tool shows what they add.
Why the gap matters
On a typical apartment the difference between gross and net is one to two percentage points, and it is widest exactly where the advertised yield is highest: high-yield communities tend to carry higher service charges, faster turnover and more competition at renewal. A 7% gross with an AED 28 per ft² service charge is a 4.9% net. That is a different investment, and it is the one you would be buying.
The two inputs to check hardest
The rent and the service charge. Use the RERA rental index or Ejari-registered tenancies for the same unit type rather than a listing price, and ask for two years of actual service charge invoices rather than the projected figure. Nothing else in the calculation moves the answer as much, and both are documents a seller or developer can produce.
Next step
Want us to look at this with you?
We can check your rent assumption against registered tenancies in the building and the service charge against the last two years of invoices — the two inputs that most often turn out to be optimistic.