Jul 24, 2025
Market Reports
Real estate returns are no longer about location alone. In the Middle East, where several cities are competing for capital, the numbers matter more than ever. Investors today want data, not just ambition. They want to know where their money will grow and how quickly it will be returned. And when the numbers are put on the table, Dubai continues to lead the region in one metric that matters most to income-focused investors: rental yield.
Over the past two years, Dubai has delivered consistently high rental returns across both mid-tier and premium properties. While other regional cities have tried to match its growth with ambitious plans, tax breaks, or large-scale developments, they have not yet managed to match Dubai’s combination of stable regulation, global demand, and liquid rental markets. When ROI is measured by actual money coming in—not just potential—Dubai’s lead becomes clearer.
Yield Is the Real Test
Anyone can build skyscrapers. But converting square footage into consistent income is where real estate becomes an asset, not just a holding. In Dubai, yields have consistently ranged between 6 and 9 percent, depending on location, property type, and whether the asset is short-term or long-term let. In communities like Jumeirah Village Circle, International City, and parts of Dubai South, landlords have seen gross yields hit double digits. Even prime neighborhoods like Downtown Dubai, Dubai Marina, and Palm Jumeirah, which are typically more capital-growth focused, have delivered yields that outperform similar high-end districts in cities like Riyadh, Doha, and Abu Dhabi.
In contrast, Riyadh’s average rental yields tend to sit between 3.5 and 5 percent, with lower returns in higher-end developments and gated communities. Part of the gap comes from pricing—Riyadh’s property values have spiked in recent years due to Vision 2030 development plans, but rental prices haven’t risen at the same pace. The mismatch compresses returns. Saudi Arabia’s ownership rules and a largely domestic tenant base also limit flexibility and foreign investor appeal. Despite the massive pipeline of projects, the country is still working through foundational reforms needed to open up its real estate sector to international participation in a serious way.
What the Numbers Say
Dubai’s rental market hit record highs in 2024 and continues to grow in 2025. According to data from the Dubai Land Department and third-party property analytics platforms, the average gross rental yield across all apartment types citywide sits around 7.2 percent. In contrast, Abu Dhabi’s residential properties average closer to 5.5 percent. Qatar’s capital, Doha, sits in the same range, with many yields in the 4 to 6 percent window depending on the area. Cairo has some of the highest yield potential on paper—particularly for off-plan or pre-finished units in New Cairo and 6th of October City—but currency volatility and inflation often erode returns before they can be realized.
In Dubai, yield is not just theoretical. It’s backed by strong occupancy. Average occupancy rates for long-term rentals currently exceed 90 percent in most mid-range and premium areas. Short-term lets, especially in tourist-heavy zones like JBR, City Walk, and Business Bay, benefit from Dubai’s year-round events calendar and flexible holiday visa system. Platforms like Airbnb and Booking.com have made short-stay rentals a mainstream strategy for landlords, with many properties earning 15 to 30 percent more than their long-term counterparts on an annualized basis, even after platform fees.
Low Taxation Keeps Net Yield High
One of Dubai’s major advantages is what doesn’t show up on the balance sheet elsewhere: tax. In most developed cities, a 6 to 7 percent gross yield can quickly become 3 to 4 percent after income tax, property tax, and maintenance levies. In Dubai, there is no annual property tax, no rental income tax, and no capital gains tax. This means that a 7 percent gross yield often stays very close to a 7 percent net return.
By contrast, rental income in Qatar is taxed at a flat 10 percent for most foreign landlords. In Egypt, returns can be taxed progressively, with rates as high as 22.5 percent when combined with capital gains and income layers. Saudi Arabia does not levy income tax on individuals but does apply zakat and various fees depending on the property structure, especially when owned through companies. Even Abu Dhabi, despite being part of the UAE, has slightly higher service charges and more limited freehold zones, which can eat into returns.
The cumulative effect of low taxation, high occupancy, and global demand gives Dubai a strong edge. Investors are not just earning more—they’re keeping more of what they earn.
Liquidity and Exit Options
Yield is only one part of the return equation. Liquidity—how quickly and efficiently an asset can be sold or refinanced—is just as important. In this respect, Dubai’s market offers flexibility that is largely unmatched in the region. The resale market is active, with over 100,000 property transactions recorded in 2024 alone, amounting to over AED 370 billion in value. Whether off-plan or ready, property in Dubai moves, and moves relatively quickly compared to regional peers.
In Riyadh and Doha, resale markets are still evolving. While demand is growing for branded residences and integrated communities, transaction volumes remain low, and resale timelines can stretch out over months. Regulatory bottlenecks and limited international buyer participation make exits slower and less predictable.
Cairo sees high sales volumes in local currency terms, but restrictions on currency movement and valuation swings complicate exits for foreign investors. The buyer pool is mostly domestic, and the shift to off-plan purchases means a large portion of sales are future-dated. For investors seeking predictable exit windows, Dubai’s secondary market provides more agility and less friction.
Who’s Driving the Demand?
The answer is simple: everyone. Dubai’s buyer and tenant profile is globally diverse. Russians, Indians, British, Chinese, Germans, Egyptians, and Nigerians all rank among the top buyers in recent reports. On the rental side, the city attracts everyone from corporate tenants and digital nomads to tourists and expats relocating with families.
This diversity insulates the market. When one region slows down, another tends to pick up. In 2023 and 2024, for example, Dubai saw a surge in Russian buyers after the Ukraine conflict intensified. At the same time, interest from Western European investors increased as they looked for tax-friendly secondary homes. Demand from Gulf nationals remains strong, and South Asian expatriate communities continue to underpin large sections of the long-term rental market.
Compare that to cities like Riyadh or Doha, where demand is still heavily reliant on local hiring trends, government job creation, and state-driven infrastructure. While those markets are growing, they lack the organic, global magnetism that keeps Dubai’s real estate engine running.
The Short-Term Rental Advantage
Dubai’s approach to short-term rentals is another reason yields stay strong. The city has embraced holiday lets as a formal part of the housing market. Owners can register properties for short stays, operate them independently or through agencies, and benefit from flexible licensing models. The city’s Department of Economy and Tourism has made short-term rental compliance relatively easy, allowing even first-time investors to tap into seasonal demand.
This stands in contrast to Abu Dhabi and Doha, where short-term letting is more regulated and less integrated into mainstream investment strategies. In Cairo, short-term rental demand is less stable and often informal, reducing both profitability and compliance. Dubai’s tourism-first approach supports landlords, not restricts them, and that makes a difference in net yield performance.
Final Word: Yield That Works in Real Life
For all the glossy brochures and grand visions across the Middle East, it’s rental yield that often separates hype from reality. Dubai doesn’t just promise returns. It pays them out. The market is liquid, the tenant base is global, taxation is minimal, and the infrastructure is built for volume.
That doesn’t mean it’s without risks. Oversupply is always a concern in fast-growing cities. Policy shifts, currency strength, and global demand can all swing sentiment. But so far, Dubai has managed those risks better than most. The numbers speak for themselves, and investors keep listening.
In a region filled with long-term promise, Dubai offers short-term returns that are real, measurable, and available now. For anyone tracking ROI, that’s hard to beat.
