Adding to a property portfolio you already own
The second purchase is a different problem from the first. You are no longer asking whether property works; you are asking whether this unit beats the one you already own, what the rental index will let you charge, and whether the answer is to buy nothing and sell something.
Read these in this order
9 frameworks. Each one ends in a number rather than an opinion.
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01Cash on cash return
Cash on cash return is the annual cash left after every running cost and every mortgage payment, divided by the cash you actually put in, and it is the only property return figure that answers what your own money earned.
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02The capitalisation rate
A capitalisation rate is a property's net operating income divided by its price, which makes it a measure of what the building earns rather than what you earn, because it deliberately excludes your mortgage, your acquisition costs and your tax position.
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03Rent increase caps and the rental index
Dubai caps how much a landlord may raise rent on renewal according to how far the current rent sits below the RERA rental index, rising in steps from no increase at all up to a maximum of twenty percent, which means a landlord's yield improvement is limited by law rather than by negotiation.
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04Break-even occupancy
Break-even occupancy is the share of the year a property must be let for its income to cover every running cost and every mortgage payment, and it converts a yield into the single question that actually keeps owners awake: how empty can this get before I am funding it.
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05Short let versus long let
A short let can gross fifty to a hundred percent more than an annual tenancy on the same unit and still net less, because the higher revenue arrives with occupancy risk, platform commission, cleaning, furnishing, utilities, licensing and roughly the workload of a small hospitality business.
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06Price per square foot
Price per square foot is the purchase price divided by the area on the title deed, and it is the only way to compare two different properties honestly, provided the comparison is made against genuine recent transactions in the same building rather than against asking prices across a district.
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07Concentration limits
A concentration limit is a rule set in advance about how much of your net worth any single asset, building, tenant, employer or currency may represent, and its purpose is to make the decision while you are calm rather than while you are being persuaded.
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08Off-plan payment plans and their real cost
Two off-plan payment plans quoted at the same headline price are not the same price, because money paid later costs less in present value, and the gap between a front loaded plan and a post handover plan is commonly five to fifteen percent of the headline figure.
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09Selling well
The price a property achieves is set mostly in the first three weeks of listing, because that is when the buyers already searching see it fresh, which makes the initial asking price the single most consequential decision in the sale and the one most often made by wishful thinking.
Run your own numbers
Nothing is stored and nothing is sent anywhere. The arithmetic runs in your browser.
Gross yield is what the brochure shows you. This is what reaches your account.
What a landlord may lawfully raise the rent to on renewal, under Decree 43 of 2013.
Two plans with the same headline price are not the same price.
Terms you will meet
Each is one sentence, then the trap it hides.
Not quite you?
Investments Playbook publishes educational research and general information. Nothing on this site is personal investment advice, a solicitation, or a recommendation to buy or sell any asset. Property and securities can fall in value. Past performance does not predict future returns. Figures shown are indicative and may be delayed. Always take regulated professional advice before acting.