Total annual rental income
Service charges, maintenance, management fees
Gross Yield
6.0%
Net Yield
5.0%
Net Annual Rent
AEDÂ 75,000
What is a good rental yield in Dubai?
A good rental yield in Dubai is typically 5-8% gross. Affordable areas like International City and Discovery Gardens can yield 8-10%, while premium areas like Downtown Dubai and Palm Jumeirah yield 4-6%. Net yields are usually 1-2% lower after expenses.
What expenses should I include?
Include annual service charges (AED 10-30 per sq ft), maintenance reserves (5-10% of rent), property management fees (5-8% of rent if using an agent), landlord insurance, and a vacancy allowance (typically 5% or one month's rent).
Dubai vs Abu Dhabi rental yields?
Dubai generally offers slightly higher rental yields (5-8%) compared to Abu Dhabi (4-7%). However, Abu Dhabi has shown stronger capital appreciation in certain areas and typically has lower service charges. Sharjah and Ajman offer higher yields but with less capital appreciation potential.
Note: There is no capital gains tax or rental income tax for individuals in the UAE. Corporate entities may be subject to 9% corporate tax on profits above AED 375,000.
How to calculate and compare rental yields on UAE investment properties
What is rental yield?
Rental yield is the annual rental income from a property expressed as a percentage of the property's value. For example, if a flat is worth AED 800,000 and you rent it for AED 56,000 per year, the gross rental yield is 7% (AED 56,000 / AED 800,000 x 100). It is one of the most important figures for property investors.
What is the difference between gross and net yield?
Gross yield uses the total rent before any expenses. Net yield subtracts costs like service charges, maintenance, management fees, and insurance from the rent first. For example, if your gross rent is AED 60,000 per year but expenses are AED 18,000, the net rent is AED 42,000. On a property worth AED 900,000, the gross yield is 6.7% but the net yield is only 4.7%.
What rental yields are typical in the UAE?
Dubai gross rental yields average 6% to 8%, among the highest globally. Affordable areas like International City (8% to 10%), JVC (7% to 9%), and Discovery Gardens (7% to 8%) offer the highest yields. Premium areas like Downtown Dubai (5% to 6%) and Palm Jumeirah (4% to 6%) have lower yields but stronger capital growth.
Is there any tax on rental income in the UAE?
No personal income tax applies to rental income in the UAE. If you own the property personally, you keep 100% of your rental profit. Municipal fees are typically 5% of the annual rent in Dubai (charged via DEWA bills), which is a small cost to factor into your net yield calculation.
What costs reduce my rental yield?
Common costs include service charges (AED 10 to AED 40 per sq ft per year), property management fees (5% to 10% of annual rent), maintenance and repairs, Dubai municipality fee (5% of annual rent), and vacancy periods (typically 2 to 4 weeks between tenants). These can reduce your gross yield by 1.5 to 3 percentage points.
How does the Ejari system affect rentals?
Ejari is the official system for registering tenancy contracts in Dubai. Every rental agreement must be registered on Ejari for it to be legally valid. The registration fee is around AED 220. Landlords also need an Ejari registration to enforce rent increases within the limits set by the RERA rental index calculator.
How do I improve my rental yield?
Furnish the property, which can boost rent by 20% to 30%. Keep the unit well-maintained to avoid vacancies. Consider short-term holiday rentals through platforms like Airbnb (requires a DTCM holiday home permit). Choose properties with lower service charges, and negotiate bulk deals with maintenance contractors to reduce costs.
FTA-Aligned: Based on 2025 FTA rates and regulations. For personal advice, speak to a qualified tax consultant.
Disclaimer: This calculator provides estimates based on current UAE Federal Tax Authority rates and MOHRE labour law provisions. It does not constitute professional tax, financial, or legal advice. Your actual entitlements may differ depending on your individual circumstances, employment contract, and applicable free zone regulations. Always consult a qualified adviser before making financial decisions. Read our terms