Dubai Marina Apartment: A Hypothetical Investment Example

Hypothetical example. Calculations checked: 29 October 2026.

This is a hypothetical Dubai Marina apartment investment calculation. Every amount is an assumption for the exercise, not a current price, historical result or transaction involving a client or Iza. We work from initial capital through four years of rent to three sale prices and an additional lower-rent scenario.

Assumptions: what is invented

The purchase price is 1,200,000 AED. We assume purchase costs of 60,000 AED, so total entry is 1,260,000 AED. This is an exercise assumption, not a fee or tax schedule. In a real purchase you need to check each line and amount against the documents.

The holding period is four years. Rent actually collected is 90,000 AED per year. That figure already accounts for any vacancy, so we do not subtract vacancy a second time. Double-counting vacancy is a common spreadsheet mistake and it understates the result.

Ownership, management and minor repairs together cost 20,000 AED per year. We assume no price growth or decline before the scenarios. The four result scenarios below are possible results to compare, not a market forecast.

• Currency: AED only, no conversion into other currencies.
• Purchase costs: 60,000 AED, paid once.
• Rent collected: 90,000 AED per year, after vacancy.
• Annual costs: 20,000 AED, held constant for simplicity.
• Selling costs: an assumed 3% of the sale price, not a current commission or tax quote.

Entry capital and annual cash flow

At entry: 1,200,000 + 60,000 = 1,260,000 AED. Purchase costs are counted once, at the start. Selling costs appear separately at exit, so nothing is counted twice.

Each year leaves 90,000 − 20,000 = 70,000 AED. Over four years that is 280,000 AED. This is a nominal sum, with no discounting and no view on exactly when the money arrived.

Constant rent and costs simplify the exercise. In a real analysis, allow for changing charges and unexpected repairs. The assumed AED 70,000 is not a market-derived midpoint or an income promise.

Three sale prices with the same rental income

All three cases use the same 280,000 AED of net rent and the same 3% selling costs. Only the price changes. The formula is simple: sale price minus selling cost, plus 280,000, minus 1,260,000.

• Rise to 1,400,000 AED: selling cost 42,000, net proceeds 1,358,000. Result: 1,358,000 + 280,000 − 1,260,000 = 378,000 AED, or 30% in total over four years.
• Flat price, 1,200,000 AED: selling cost 36,000, net proceeds 1,164,000. Result: 1,164,000 + 280,000 − 1,260,000 = 184,000 AED, about 14.6% in total.
• Fall to 1,000,000 AED: selling cost 30,000, net proceeds 970,000. Result: 970,000 + 280,000 − 1,260,000 = −10,000 AED, about −0.79% in total.

Why we do not divide the result by four

The 30% figure is a four-year total, not an annual rate. You could divide it by four and get 7.5%, but that is a crude shortcut, not an IRR or a compound annual growth rate. It ignores that rent arrived gradually while the purchase cost was paid on day one.

So this article sticks to totals in AED and percentages of the 1,260,000 AED outlay. If you need an annual rate, compute it from dated cash flows in a spreadsheet rather than by dividing. That keeps comparisons with other assets on equal terms.

Stress case: weaker rent and a lower price

A stress case asks what happens when two things go wrong together. Suppose rent actually collected is 65,000 AED per year with the same 20,000 AED of costs. That leaves 45,000 AED a year, or 180,000 AED over four years.

Add a sale at 1,000,000 AED. Net proceeds are 970,000 AED. Result: 970,000 + 180,000 − 1,260,000 = −110,000 AED, about −8.73% in total. Compared with the earlier falling-price case (−10,000 AED), the whole difference is 100,000 AED less rent.

The practical lesson: for a buy-to-let, rent matters as much as the exit price. A careful model has at least one row with lower rent.

Cash at closing is not profit

In the rising-price case, 1,358,000 AED lands in the account. That is not profit, because it includes the return of the capital put in. The nominal profit is 378,000 AED: total inflows (1,358,000 + 280,000) minus the 1,260,000 AED entry.

Confusing proceeds with profit is a frequent error in sale conversations. The number on the sale contract looks impressive, but it has to be compared with what was paid in at the start and along the way. For the order of costs at exit, see our guide to selling a Dubai apartment.

Break-even sale price

You can also ask the reverse question: at what sale price P is the result zero? From the assumptions: P × 0.97 + 280,000 = 1,260,000. So P = 980,000 / 0.97, roughly 1,010,310 AED. Below that price, with this rent and these costs, the nominal result is negative.

In the stress case: P = (1,260,000 − 180,000) / 0.97, roughly 1,113,400 AED. Weaker rent raises the break-even by more than 100,000 AED. This illustrates the mechanics; it is not a promise or a price forecast.

We round on purpose. With assumptions this rough, precision down to the fils would give a false sense of accuracy.

What this calculation leaves out

This is a nominal calculation, before financing, tax and currency effects. Each of those can change the conclusion, so a table of four results is only the start of an analysis.

For a fuller list of purchase and ownership costs, read buying and ownership costs for a Dubai apartment. The gap between gross and net yield is covered in Dubai rental yield and net return.

• Financing: with a loan, interest and principal repayments enter, and the result should be measured against the equity actually invested, not the full price.
• Tax: it depends on residency and personal circumstances, so we quote no rates here.
• Currency: if your spending and goals are in another currency, every dated cash flow matters, not just the sale price.
• Delayed sale: a slow sale extends the holding period and may bring extra costs or rental gaps.
• Vacancy: estimate its effect on collected rent in a forecast. Do not subtract it again in a historical calculation already based on actual receipts.

How to rebuild this in a spreadsheet

The safest layout is one row per cash flow. You can then see where every number comes from, and later changes (say, a higher service charge) touch only one row.

• Date of each receipt and payment.
• Purchase price as an outflow; gross sale price as an inflow.
• Buying and selling fees as separate outflows. With this method, do not also enter net sale proceeds.
• Rent actually collected as inflows; ownership, management and repairs as outflows.
• Loan drawdown as an inflow; instalments and final outstanding-debt repayment as outflows. Split principal and interest without also counting the full instalment again.
• Taxes and currency conversion according to dates and your circumstances. Calculate equity returns from the investor’s cash flows.

Risk: why this example is not your case

The arithmetic alone does not tell you whether a Dubai Marina investment is good or bad. The result depends on purchase price, rent, costs and sale price, and each has to be verified for the specific unit. Compare your assumptions with current market data and research before you enter them in the model. A starting point is our piece on Dubai property prices, data and scenarios.

Two apartments in the same area can produce different results. What matters is the real legal and physical status of the unit: its condition, the level of service charges, the terms of the lease, the title, and bank checks if there is financing. Izzy Agent Team has not based this text on any real case, so treat it as a template for the calculation, not as a pattern for the outcome.