How we underwrite a Dubai property

Every unit we put in front of a client goes through the same steps, line by line, before we say a word about it. This is the method. Every figure is either from a named source (DLD, Mollak, the banks) or marked as an assumption to confirm.

The rule: net, never gross

Most of Dubai runs on gross yield: annual rent divided by purchase price. It ignores what it cost you to buy, what it costs you to run, and what it costs you to leave. We underwrite on net: what you keep, against everything you put in.

A unit advertised at a high gross yield can end up well below it once every cost is in, and a well-bought, well-furnished unit can beat its own listing. The steps below are how we tell the difference.

Step 1: All-in cost, not the sticker price

Purchase price, plus:

• DLD transfer fee (4%)
• DLD admin and trustee fees
• Agency fee (typically 2% + VAT)
• Mortgage costs if financed: registration, arrangement fee, valuation
• Furnishing or renovation budget

This is what the yield is measured against. Using the sticker price instead is the most common way a yield gets flattered. The full fee list is in our guide to what it really costs to buy property in Dubai.

Step 2: What it really costs to run

• Service charges: rate × size, from the actual Mollak rate, not the listing's estimate
• A maintenance reserve, stated up front
• Insurance
• Long-term let: leasing or management fees, and realistic vacancy between tenants
• Holiday home: operator fee, permit, utilities, cleaning and linen, platform fees
• Mortgage interest if financed

Step 3: What it really earns

• Long-term: contracted rent minus vacancy
• Holiday home: rate × nights × an occupancy we can defend from comparable operating data, not the brochure

Step 4: The numbers that decide

• Net yield = (income − running costs) ÷ all-in cost
• Cash-on-cash if financed
• Payback on furnishing: how many months the fit-out takes to return its cost in extra rent
• Exit: selling costs, NOC fees and settlement fees come out before any profit is real

We always run a conservative case next to the base case. A plan that only works in the best case isn't a plan.

What we won't do

• Quote a yield without saying whether it's gross or net
• Use a developer's or listing's service-charge estimate when the Mollak figure exists
• Show only one scenario
• Put a unit in front of you that we wouldn't underwrite ourselves

Want us to run this on a specific unit? Get in touch or try the net yield calculator.