Investment & yield
Net Yield
Net yield is annual rental income minus operating costs, divided by the property's value, giving a truer measure of return than gross yield.
Net rental yield deducts recurring costs, such as service charges, maintenance, management fees, insurance, and allowances for vacancy, from the annual rent before dividing by the purchase price or value. Because these costs can be significant, the net figure is typically several percentage points below the gross yield. Investors comparing Abu Dhabi properties should work with net yield to understand real cash return, while remembering that figures vary by area, building, and tenancy and this is not investment advice.
Related terms
- Gross Yield — Gross yield is annual rental income divided by the property's purchase price, expressed as a percentage before any costs.
- Service Charge — A service charge is the recurring fee owners pay for the upkeep of shared areas and facilities in a building or community.
- ROI (Return on Investment) — ROI measures the total gain from a property relative to what was invested, combining rental income and any change in value.
- Rental Index — A rental index is an official reference of typical market rents by area and property type, used to guide fair rent and renewal increases.