I’m Laila Janik, CEO of MYS Real Estate, and I’ve spoken with many international investors who are astonished that a modest apartment in Dubai can yield more and grow faster than premium properties in other global cities. Let’s dissect why a one-bedroom in Dubai can be a far more lucrative (and simpler) addition to your global portfolio than comparable investments in London, New York, or Hong Kong.
Higher Yields Than Global Hotspots: Rental yield is king when comparing investment properties, and Dubai is the reigning champion among prime cities. To put it in perspective, Dubai’s gross rental yields average around 7-8% for apartments, and can go higher in certain locales nikoliers-global.com. Now compare that globally:
● London (Prime zones): Yields are modest – typically around 3-4% for a central London apartment phoree.ae and taxes.. Some London investors count themselves lucky with 4%, given high purchase prices
● New York City: Gross yields in Manhattan are roughly 3-5%; a Midtown condo might fetch only ~4% phoree.ae. Outer boroughs can be higher, but then you’re not in prime Manhattan.
● Hong Kong: Infamously low yields, often 2-3% in the prime areas phoree.ae due to astronomical prices relative to rent.
● Singapore: Similarly low, around 2-4% for prime condos phoree.ae, owing to high capital values and government measures keeping yields down.
In contrast, Dubai’s prime areas can often deliver 5-6% yields, and secondary areas 7-9% guestready.com nikoliers-global.com. For example, a Downtown Dubai one-bedroom offers around 6% gross yield guestready.com, while a similar central London unit might be ~3%. Jumeirah Village Circle one-bedrooms yield ~7% guestready.com, versus a Hong Kong equivalent maybe 2.5%. So on a pure income basis, Dubai can double or even triple the yield of other major cities. And remember – no annual property tax in Dubai, and rental income is not taxed for individuals. So that 6-7% is net in your pocket (aside from minor fees) phoree.ae. Meanwhile, a 4% London yield might be whittled down to 2.5% after taxes and expenses. The difference is huge. This is why global investors are shifting capital to Dubai – money simply works harder here in real estate.
Tax & Cost Advantages: Let’s expand on taxes. Many major markets will tax your rental income (e.g.,~20% in the UK after allowances), have property taxes (NYC, London have significant annual taxes), and high closing costs (stamp duty in London up to 15% for foreigners, wow!). Dubai: 0% income tax, 0% capital gains tax, 0% inheritance tax. There is a one-time 4% transfer fee and small ongoing service charges, that’s it. One investor told me buying in Dubai felt like a relief because the price he agreed was basically the price – no ~8-15% extra like he’d pay in his home country between taxes and stamp duties. Over years, not having to surrender a chunk of rent to the taxman means Dubai properties inherently yield more net. And on exit, if the property appreciated, those gains are yours fully (no capital gains tax). That’s a stark contrast to, say, selling a property in California or London and losing a big slice to taxes. It’s not just what you make, it’s what you keep – and in Dubai you keep more.
Also consider currency and stability: The UAE Dirham is pegged to the US Dollar, providing FX stability. For global investors, that’s comforting – your returns aren’t getting eroded by currency fluctuations like they might in, say, an emerging market with a volatile currency. AndDubai’s political stability and investor-friendly policies mean property rights are secure (you can fully own freehold as a foreigner, which isn’t always the case elsewhere).
Strong Capital Appreciation Potential: Rental yield aside, Dubai’s property market is in a growth phase. We saw average apartment prices jump ~16% in 2023 globalpropertyguide.com, and while every market has cycles, Dubai is still relatively “young” with major development and population growth ahead. Compare that to some global cities where properties are so mature in value that growth is stagnant or just tracks inflation. One-bedroom apartments in good Dubai locations can see significant capital gains as the city expands. For instance, a one-bed in Dubai
Marina that was $300K two years ago might be $350K+ today due to the surge in demand (and still yielding nicely). Meanwhile, many London or HK investors have seen flat or declining prices in recent years due to taxes or political issues. Another angle: affordability gap – prime Dubai property is still way cheaper than prime Paris, London, NYC by a factor (Downtown Dubai $700/sqft vs London $1,500+/sqft for instance). This suggests room to run, especially as more foreign investors flock to Dubai for value phoree.ae. By buying now, you could ride a continued appreciation wave that might not be possible in other saturated markets.
Less Red Tape, More Flexibility: Global investors often remark how easy investing in Dubai is. Transactions can be done in days, not months – (try closing on a Tokyo apartment, it might take months of paperwork). Rental laws are straightforward, and you won’t have government constraints like rent control chopping your yield (Dubai’s rent increase rules allow fair adjustments by an index if you’re below market nikoliers-global.com, which actually helps ensure you can reach market yield in time). The freedom to use your property as you see fit – long-term lease, short-term rental (Airbnb is legal and common in Dubai with simple permitting) airbtics.com, or leave vacant – is also attractive versus places with heavy regulation on usage. Want to sell to another foreigner? No restrictions. Repatriating your funds? No currency controls (contrast with some countries). It’s truly an open, investor-friendly system – something global investors often only find in select markets like Dubai.
Quality and Lifestyle Upside: Hard to quantify but worth noting: Dubai’s one-bed apartments, especially new builds, are often in modern towers with gyms, pools, concierge – very attractive to tenants and to second-home buyers. Many come with views (sea, canal, skyline) that in other cities would be unaffordable. This means when you go to resell, you’re selling a lifestyle as much as a property. I’ve had clients buy a Downtown one-bed purely as a pied-à-terre (non-resident investor who uses it 1 month a year and rents short-term rest of time). That dual-use desire (investment + personal use) is more viable in Dubai where you can get a luxury feel one-bed for, say, $500K, versus needing $2M in New York for similar cachet. This expandsyour buyer pool in future – not just investors, but lifestyle buyers too, potentially boosting resale value.
A quick example to wrap up: David from Hong Kong (a client) sold a small flat there (yielding 2% and under pressure due to expat departures) and with those funds bought 3 one-bedrooms in Dubai – one in Downtown, one in Marina, one in Creek Harbour. Combined, they yield about 6.5% net. His cash flow quadrupled in absolute terms. Plus, he’s seen ~20% uplift in portfolio value in two years (something unheard of back home lately). And he enjoys visiting his Dubai properties – a business trip where he stays in his own Marina apartment (with yacht bay views). He joked that for the first time, his real estate is both profitable and fun.
Conclusion: For global investors, Dubai’s one-bedroom apartments offer a rare combination of high returns, low taxation, ease of ownership, and strong market fundamentals. It’s like finding a high-yield stock in a world of low dividends – but with much lower volatility and a growth kicker to boot.
If you’re comparing international investment options, the numbers and advantages in Dubai are hard to ignore. Let’s have a conversation about how a one-bedroom investment here could fit into your global portfolio. Reach out to me directly, and I can provide detailed yield analyses, market forecasts, and handle the logistics of acquiring and managing property here. Diversifying into Dubai might be the smartest global move you make – and I’m here to ensure it’s seamless and rewarding. Your portfolio deserves a piece of this city’s success. 🌍🏠💼
