The Rent You Quote Is Not the Rent You Collect
Every yield number starts with a rent. Usually it is the rent someone hopes to get. The rent you actually collect over a year is lower, for reasons that are boring and predictable.
Where rent leaks
- Empty months between tenants, even if you find the next one quickly.
- Negotiation. The final rent is often below the asking price.
- Costs you pay before the first cheque: cleaning, small repairs, agent fees, and sometimes furnishing.
- Service charges and maintenance that continue whether the unit is rented or not.
Calculate your collected rent
Example with made-up numbers. Asking rent 100,000 a year. You negotiate 95,000. You lose one month between tenants, about 8,000. You pay 6,000 in agent fees and small repairs. Collected rent is about 81,000 before service charges. The “100,000” in the brochure became 81,000 in your account.
Now divide that by the full cost of buying, not only the price. That is your real yield, and it is the only one that pays your bills.
Questions to ask before you trust an asking rent
- What did similar units in this building actually rent for in the last few months?
- How long did they stay empty?
- What does the owner pay each year even with a tenant?
Ask for real recent contracts, not advertised prices. Official rental data from the Dubai Land Department can be checked before you decide.
