Service charges and net yield: what Dubai landlords actually earn
The rent cheque is not your return. Service charges and other costs sit between gross and net — and they are bigger than most owners assume.
What service charges are
If you own an apartment in a jointly owned property, you pay an annual service charge to the Owners Association for the upkeep of the building and common areas. In Dubai these are administered through the Mollak system, billed as an amount per square foot, and the figure varies widely by building and community.
The service charge typically also funds the building’s master insurance policy — which is why apartment owners usually do not need to buy separate "building insurance": you already pay for it here.
Gross vs. net yield
Gross yield is simply annual rent ÷ property value. Net yield is the number that actually matters:
- Gross yield = annual rent ÷ purchase price
- Net yield = (annual rent − service charge − other holding costs) ÷ purchase price
Why track it per unit
Across a portfolio, service charges are the cost most owners under-count because each building bills differently. Pillar OS captures the service charge per unit and shows the resulting net yield alongside the rent, so the real return is visible — not just the headline.