Headline gross yields advertised by agents (8%, 9%, 10%) rarely reflect actual net returns after service charges, property management, and vacancy. This calculator strips out all costs to show your real net yield — the number that matters for investment decisions.
Enter purchase price, rental income, and costs — see gross yield, net yield, and simple payback period calculated live. Works for both long-term and short-term rental.
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Discuss StrategyDubai property marketing commonly advertises gross yields of 7-10% — the simple ratio of annual rent to purchase price. These figures are mechanically accurate but materially misleading for investment decisions because they ignore substantial operational costs: service charges (AED 10,000-50,000 per year depending on building), property management fees (8-30% of rent), vacancy periods (5-35% depending on rental strategy), minor repairs and maintenance (AED 5,000-15,000 annually), and occasional major maintenance (appliance replacement, AC servicing, etc.).
For a typical AED 2M Business Bay apartment rented at AED 130,000/year gross (6.5% gross yield), realistic net yield after all costs is approximately 4.5-5%. This is still excellent by international standards but a 1.5-2 percentage point gap from the gross headline. Buyers making decisions on gross yield often overestimate returns and underestimate operational complexity.
The calculator above prompts for specific cost inputs — service charges (from your building's financial statements), property management (percentage or flat fee), and vacancy rate (conservative at 5-10% LTR, 25-35% STR). Running realistic inputs typically produces net yield 20-30% lower than gross yield, which is the figure actually relevant to your hold period economics.
Long-term rental (LTR) provides stable cashflow with lower yield. Typical Dubai LTR lease is 12 months with renewal, annual rent payment upfront or split into 4-6 cheques. LTR yields typically 6-8% gross, 4.5-5.5% net. Vacancy is low (5-8%), tenant turnover costs are modest (AED 2,000-5,000 between tenants), and management is cheap (8-10% of rent annually).
Short-term rental (STR / Airbnb / holiday homes) can deliver higher gross yields (8-11%) but with substantially higher costs and volatility. STR yields 8% gross translate to 4-5% net after: STR management (typically 20-25% of revenue), cleaning and linen (AED 150-300 per turnover), platform commissions (3-5%), furniture and setup amortisation, higher utility costs, and vacancy (typically 25-35% annually). STR income also varies month-to-month based on tourism seasons.
The calculator lets you toggle between LTR and STR types, which adjusts assumed "other costs" (STR has higher maintenance, utilities, and minor costs than LTR). For same property and same gross income, LTR usually produces equal or better net yield with lower operational headache. STR advantages emerge mainly in tourist-heavy districts (Marina, Downtown, Palm) where STR nightly rates command meaningful premium over LTR equivalents.
Building-specific. Older JVC buildings: AED 10-18 per sqft annually. Modern Marina or Dubai Hills: AED 20-30. Downtown premium towers: AED 25-40. Palm Jumeirah branded residences: AED 40-80+. For a 1,000 sqft apartment in Business Bay at AED 25/sqft, annual service charges are AED 25,000. Always request the specific building's historical service charge trend — rates rise 3-5% annually typically.
Yes, operationally. STR requires professional photography, platform listing management, dynamic pricing optimisation, daily check-in/check-out coordination, cleaning between stays, furniture and linens replacement on ~2-year cycles, guest communication, and handling of damages. Most buyers outsource all of this to specialist STR managers at 20-30% of gross revenue. Self-management is possible but realistically requires 10+ hours per week per property.
Three sources. First, the building's existing rental listings on Bayut or Property Finder for similar units — gives current market rates. Second, Dubai Land Department's REST Dubai portal publishes actual rental contracts registered for each property. Third, reputable property managers (Bayut Property Management, Your Home Dubai, etc.) can provide rental valuations for specific units. Combine all three for confident income projections.
Conservative: 5-8% for LTR in popular districts, 8-12% for LTR in peripheral districts, 25-30% for STR annually (vacancy concentrated in summer months and Ramadan). Very new buildings or unusual units (penthouses, specific villa types) may have longer initial vacancy as tenant markets discover them. Stable buildings with strong tenant demand can achieve 2-3% vacancy consistently.
No — this calculator is income-only. Capital appreciation is separate and depends on market conditions, district, holding period, and timing. For total return calculation (yield + appreciation), use the ROI calculator instead. For evaluating "will this property pay its operating costs" the rental yield calculator is the right tool.
Net yield for real investment decisions. Gross yield is a quick comparison shorthand — useful for ranking properties within same district where service charges are comparable. For cross-district comparison or final investment decision, net yield after all costs is the only relevant figure. A 7% gross yield in high-service-charge premium district may deliver worse net than 6% gross yield in lower-charge value district.
For specific properties, we can provide rental estimates from Dubai property databases, plus service charge history and realistic vacancy expectations. Share the property or area on WhatsApp.
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