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Apartments in Al Khail Heights, Discovery Gardens and Remraam have all offered over 8 percent average gross investment yields.
Investing in Dubai’s residential property market usually brings to mind luxury villas and penthouses but a recent report shows that affordable apartments are currently offering the highest returns on investments.
According to Morgan’s International Realty’s Dubai Real Estate Market Report Q1 2021, apartments in Al Khail Heights, Discovery Gardens and Remraam have all offered over 8 percent average gross investment yields.
The lowest rental yield, 4.37 percent, was registered in Dubai Creek Harbour. And other high-profile communities such as The Palm Jumeirah had a yield of 5.85 percent, Dubai Marina 6.05 percent, Downtown Dubai 5.66 percent and Motor City 7.56 percent.
Villas produced lower yields than apartments: Dubai Sports City offered the highest yield at 6.23 percent, and luxury development Jumeirah Islands the lowest yield at 3.93 percent.
Some of the emirate’s best-known communities produced higher yields for villas: Arabian Ranches 5.44 percent, the Palm Jumeirah 4.56 percent, Silicon Oasis 5.26 percent and Dubai Hills Estate 4.66 percent.
Elias Hannoush, managing director of Morgan’s, said, 'Four percent yield for a prime location property and six percent for a non-prime location property is considered a healthy yield. Although rentals have been falling for the past two years in Dubai, most Dubai communities are still achieving what’s considered to be a healthy yield'.
Hannoush also said a draft law by Dubai Land Department, which seeks to impose a rent freeze for three years, would support yields in communities which will have a lot of supply of new properties in the coming year and a half.
