How return is built
Total return = (sum of net rent received) + (sale price − purchase price − transfer costs at exit).
Worked example — Vida Residences 1BR, 5-year hold
Assumptions: purchase at AED 2.5M, gross rent AED 127,500/year (5.1% yield), net rent ~AED 90,000 after brand-tier OA, agent, maintenance and insurance. Capital appreciation 4% per year. Sell year 5 at ~AED 3.04M, less ~4% transfer/agency.
Vida Residences 1BR — illustrative 5-year return (AED, indicative)
| Purchase price | 2,500,000 |
|---|---|
| Net rent, 5 years | ~450,000 |
| Sale price (4% p.a.) | ~3,041,000 |
| Less transfer / agency at sale | ~122,000 |
| Total return | ~869,000 |
| Approximate ROI | ~35% (5 years, ~6.2% annualised) |
Worked example — Vida Residences 2BR, 5-year hold
Assumptions: purchase at AED 4.5M, gross rent AED 200,000 (4.4% yield), net rent ~AED 130,000 after costs. Capital appreciation 4%. Sell year 5 at ~AED 5.47M.
Vida Residences 2BR — illustrative 5-year return (AED, indicative)
| Purchase price | 4,500,000 |
|---|---|
| Net rent, 5 years | ~650,000 |
| Sale price (4% p.a.) | ~5,475,000 |
| Less transfer / agency at sale | ~219,000 |
| Total return | ~1,406,000 |
| Approximate ROI | ~31% (5 years, ~5.6% annualised) |
Stress-tests
Flat-appreciation: ROI compresses to net yield only. Down-cycle: brand-tier buildings hold value better than mid-tier through troughs, which floors the year-5 sale price.