Business Bay

Central business district, strong corporate demand, mid-range positioning

STR (Airbnb)

4.2%

1BR annual yield

LTR (Long-Term)

4.3%

1BR annual yield

Winner

LTR

2.2% delta

STR Analysis (1BR)

Nightly RateAED 380
Avg Occupancy76%
Annual Nights277 nights
Gross Annual RentAED 105,412

Fees & Costs (Annual)

Tourism Dirham (277 nights)AED 5,540
Cleaning (277 stays)AED 23,545
Platform Fee (Airbnb 12%)AED 12,649
Property Management (17%)AED 17,920
Net Annual IncomeAED 45,715.52
Yield4.2%

LTR Analysis (1BR)

Annual RentAED 55,000
Gross Annual RentAED 55,000

Costs (Annual)

Maintenance, agent fees, vacancy loss (15% of rent)AED 8,250
Net Annual IncomeAED 46,750
Yield4.3%

Break-Even Analysis

To match the LTR net yield of 4.3%, your STR would need:

Minimum Occupancy

34%

Current market: 76%

Annual Nights

123

At 380 AED/night

Status

STR Wins

42.3% margin

Why Choose STR?

  • Higher potential yield (4.2% vs 4.3%)
  • Pricing power during peak season
  • Flexibility to live in property or adjust strategy
  • Direct guest feedback and experience control

Why Choose LTR?

  • Hands-off income stream
  • No DET license, DTCM registration required
  • Tenant stability and predictable cash flow
  • Lower management friction and regulations

Important Regulatory Notes

  • 1.DET License Required: All STR must be licensed. Application process takes 4-6 weeks. Non-compliance risks fine or property impounding.
  • 2.DTCM Registration: Property must be classified and registered. Tourism Dirham collected upfront or via platform remittance.
  • 3.Occupancy Realism: 76% is market average. Expect variance based on location, listing quality, pricing strategy.

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