Bayut Exclusive:Top Rental Yields for 1-Bed Apartments

With rents remaining steady and prices rationalising, the UAE real estate market has become a favourite arena for investors looking to earn premium returns on their investment. As the UAE’s residential market is characterised by apartment living, many young families moving to Dubai and Abu Dhabi find an average 1-bedroom apartment ideal for their needs, making the category stay in high demand throughout the year. If you have had the thought of acquiring a suitable investment in Dubai or Abu Dhabi to benefit from high rental gains, Bayut.com reckons you materialise the thought after consulting our guide to the areas that offer the best rental yields for 1-bed units.

Dubai

While the glamour and allure of Dubai has continued to attract millions of tourists every year, its resilient economy has resulted in a vibrant job market that attracts talent from around the world as well. For many such professionals, a 1-bed unit makes for an ideal living quarter, and the resultant demand has made these units one of the most rewarding investments in Dubai. In the outgoing month of December 2016, rent for 1-bed units averaged AED 87k ($23.7k) a year, while average yield was 6%. But the yield went much higher when individual areas were considered.

The locality at the top of the table for highest rental yield for 1-bed units in December ’16 was International City. Average rent for the units in this area was AED 51k in December, while the yield topped out at 10%. Next on the table was Dubai Silicon Oasis, where 1-bed apartment rent averaged AED 63k and average rental yield amounted to 9.4% of the unit value. Dubai Investment Park took the third spot by returning an average yield of 9.1%, while Jumeirah Village Triangle claimed the fourth position with an average yield of 8.83%.

Both Dubai Sports City and Al Furjan returned an average yield of 8.8%, while Jumeirah Village Circle and International Media Production Zone offered landlords yields of 8.18% and 8.11%, respectively. A word of advice for investors; residential spaces in Al Furjan – with its relative proximity to the Expo 2020 site and Al Maktoum International – could be hot commodities in the near future as Dubai prepares for the mega event. Honourable mentions should be made of Jumeirah Lakes Towers and Dubailand, both of which missed out on the 8% mark with respective yields of 7.93% and 7.64%.

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Abu Dhabi

At AED 84k ($22.9k) The average rent for 1-bed apartments in Abu Dhabi was slightly more affordable than in Dubai, and the average yield also slightly better than Dubai’s at 7%. Area wise, the honour for offering the best rental yield for 1-bed units in the UAE capital went to Al Khalidiyah, an upscale community with easy accessibility to beaches along the Arabian Gulf. One-bed unit rent here averaged AED 76k in December, returning owners an average yield of 12%.

It was followed by Danet Abu Dhabi, a peaceful locality offering a rental return of close to 9%. With an average rental yield of 8.7%, Al reef claimed the third place, while Al Ghadeer, a popular and pleasant settlement along the emirate’s border with Dubai, returned a yield of 8.1% on average. Properties on the luxurious Al Reem Island returned fortunate landlords a rental return of 8%, whereas Al Raha Beach was at the sixth spot with rental returns averaging 7.6%.