Over the past few years, Dubai real estate has been so hot that deals can close with “a single phone call.” When short-term flippers with low investment literacy crowd into the market, prices tend to surge fast—and fall just as fast—creating a classic bubble → panic-selling cycle.
This article clarifies common misconceptions, explains the market mechanics, and lays out principles you can actually operate by.
Assuming a purchase price of JPY 24,000,000 and annual rent of JPY 1,800,000:
Gross yield = 7.5%.
That is not the net yield.
Like Japan, Dubai properties incur maintenance and other running costs,
so the net yield will be lower.
— Masa Nozaki (@MasaNozaki2), Aug 29, 2025
“Because leases auto-renew, cash flow is predictable.”
It sounds neat, but auto-renewal alone doesn’t guarantee CF stability. Rent revisions, vacancies, service charges, capex, and rule changes can all shift your numbers.
We also see frequent confusion between:
Rule of thumb: the simpler the pitch, the more cautious you should be.
Change one assumption and your cash flow can break.
In a heated market, high-ticket deals can close with shallow due diligence. That’s scary, but it also creates opportunity when the cycle turns:
A high-supply pipeline in 2027–2028 is widely discussed. When supply lands, flippers’ exits narrow—an easy spark for panic selling.
This is a projection, and actual impact will depend on rates, FX, demand, and policy—i.e., a mix of factors.
Judge by earnings reality, not short-term momentum.
1) Evaluate yield on a net basis
Include service charges, maintenance/capex, taxes/fees, furniture, realistic vacancy, leasing costs, PM/agency fees, and platform fees (for STR).
2) Verify the quality of rental demand
Commuting nodes, schools, transit, retail.
Tenant tenure & profile (tourist-only demand is volatile).
Renewal clauses, break options, rent-review practice.
3) Test substitutability
If a flood of similar alternatives exists at the same price point, downside pressure is high—even in good locations if new supply walls are near.
4) Know your exit mechanics
Process and fees for foreign sellers, expected timing, buyer segments.
Track recent closed comps and list-to-close gaps.
5) Keep leverage disciplined
Model rate/FX stress (interest coverage, LTV, DSCR).
Understand loan covenants and your Plan B under stress.
Keep the decision tree simple:
Who rents? At what yield? For how long? Can I hold through a downturn?
If you can answer those with numbers, you’re playing the right game.
If you’ve ever looked into real estate investment in Abu Dhabi, you’ve likely come across Aldar, one of the most prominent names in the region.
Established in 2004 by the Abu Dhabi government and listed on the Abu Dhabi Securities Exchange since 2005, Aldar is widely regarded as the leading government-backed developer in the emirate.
In December 2021, Aldar acquired approximately 85.5% of Egypt’s major real estate developer SODIC, marking a strategic expansion into the largest market in North Africa.
Aldar is not alone in targeting Egypt. Emaar, the largest developer from Dubai, is already active in the Egyptian market, pushing forward major residential and commercial developments in Cairo and the New Administrative Capital.
This wave of investment by Gulf-based companies highlights the growing strategic interest in Egypt as a real estate and economic hub.
Egypt boasts a population of over 100 million, making it the most populous country in the MENA (Middle East and North Africa) region.
The MENA market is united by shared language (Arabic) and culture (Islam), and is expected to grow into a region of 550 to 800 million people. Within this, Egypt stands out for:
Beyond developers, governments and financial institutions from the Gulf are also eyeing Egypt.
This month, the Deputy Ruler of Sharjah paid an official visit to Egypt’s New Capital, signaling a broader UAE interest in Egyptian development.
Such high-level engagements suggest that Egypt will continue to attract significant foreign capital in the coming years.
With a massive population, ambitious infrastructure projects, and increasing foreign interest, Egypt’s real estate sector is fast becoming a focal point for MENA investors.
For investors seeking long-term growth opportunities in emerging markets, understanding Egypt’s strategic importance is now essential.
Just like in Japan, where certain developers have built strong reputations, Dubai and Abu Dhabi also have well-known real estate companies trusted by consumers. In this article, we’ll introduce five of the most popular real estate developers in Dubai and explore key trends such as the risks of off-plan investments and the growing value of second-hand office properties.
In the past, buying off-plan properties (pre-construction) could result in doubling property values upon completion. However, with current high prices and an oversupply in the market, such gains are rare.
Despite this, many agents heavily promote off-plan investments—largely due to higher sales commissions. Be wary of overly optimistic pitches lacking clear risk disclosures. A cautious and informed approach is key.
There is a significant shortage of office space in Dubai, especially for SMEs. Some business licenses require a physical office, and such properties are becoming increasingly competitive.
In contrast to residential units—which are relatively easy to find—securing a good office space can be quite difficult. This market dynamic makes rental office properties a potentially stable and profitable investment in Dubai.
Introduction
In Dubai’s real estate market, an increasing number of agents have begun promoting properties with promises like:
“Once completed, this unit can be rented out on Airbnb for high returns!”
But is it really that profitable?
This article takes an objective look at the 2025 Airbnb market in Dubai, based on the latest data, to explore:
Dubai’s Airbnb Market: Key Figures
📊 According to February 2025 data from AirROI:
Due to seasonal fluctuations in Dubai’s short-term rental market, further analysis by season shows:
What Kind of Properties Are on Airbnb?
Source: AirROI
Conclusion
The data clearly shows a few key takeaways:
✅ Small units dominate the market—especially 1 and 2-bedroom apartments
✅ Family-sized units (3BR+) are scarce, suggesting potential opportunity
✅ Agents claim high profits, but the reality may differ
Given average prices of USD 240,000–410,000 for such units, and average gross revenue of USD 24,830/year, the gross yield is around 9%.
However, considering:
The net yield likely falls to around 4–5%.
This analysis is based on current data and trends, which may evolve. Still, the notion that “Airbnb guarantees high profits” seems overstated based on actual market numbers.
This article provides up-to-date insights into the real estate loan environment in Dubai, one of the world’s most dynamic property markets. With a focus on both collateral-backed loans and income-based mortgage options, we aim to help international investors make informed decisions.
1. Real Estate Collateral Loans in Dubai
In recent months, we’ve received numerous inquiries such as:
“Can I borrow money using my property in Dubai as collateral?”
The answer is: Yes, you can.
Although conditions vary by bank, as of July 2025, the general terms are:
While financing is possible, the interest rate is relatively high.
In addition to loans against owned properties, Dubai also offers real estate purchase loans based on your income level. These are commonly used when acquiring new property.
Here are the typical terms (as of July 2025):
※ If you hold a Dubai visa and earn over 15,000 AED per month, the loan-to-value ratio may increase to 80%.
To apply, you’ll generally need:
Compared to collateral loans, income-based real estate loans tend to offer better interest rates, since banks consider steady income as a lower risk.
Dubai’s real estate market is increasingly supported by debt-based financing, not just high-net-worth cash buyers.
In Q1 of 2025, Dubai recorded 9,300 residential mortgage registrations, marking a 24% year-over-year increase—a historic high.
This trend shows that:
“Dubai’s real estate market is no longer purely cash-driven—it’s increasingly debt-supported.”
That’s not necessarily negative. However, in real estate history, markets with rapidly rising loan usage become especially vulnerable when prices start to decline.
When a market enters a “reverse cycle”, the risk of loan defaults increases dramatically.
This is why it is critical to monitor market signals and make cautious investment decisions.
If you are considering investment in Dubai real estate—or establishing a company in Dubai—it is now possible to set up a corporate entity for as low as 12,520 AED (approx. ¥500,000 JPY).
For more detailed guidance or consultation, please feel free to contact us anytime.
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