How the number is built
A yield is only as honest as its method. Here is the full calculation, every assumption stated, so you can check the figure yourself.
The Real Yield formula
Real Yield = ( AnnualRent − ServiceCharge×Area − Void − Mgmt ) ÷ TransactedPrice
- AnnualRent
- Annual rent from Ejari registered contracts, not the advertised asking rent.
- ServiceCharge × Area
- The published service charge per square foot, times the unit area. A real annual cost, not ignored.
- Void
- A stated vacancy allowance for the weeks a unit sits empty between tenants.
- Mgmt
- A stated property management fee, as a percentage of rent.
- TransactedPrice
- The price the unit actually registered at with the DLD. Not the asking price.
The assumptions, stated
- Vacancy
- A fixed allowance applied to every unit, published with each issue and held constant so communities compare fairly.
- Management
- A fixed management fee applied uniformly, published with each issue.
- Period
- Figures are annual. Exit costs and resale liquidity are assessed separately, on the second axis of the method.
Sources
- DLD registered transactions, via Dubai Pulse.
- Ejari registered rent contracts.
- Published building service charges.
Why gross misleads
A gross yield divides advertised rent by the asking price and stops there. It ignores service charges, vacancy and management, and it uses two numbers no one actually paid. Net yield on the registered price is the figure you can bank on.