1. Definition of the area and data structure
Actual location: according to DLD, Palace Residences – North is located in the Al Khairan First area (Dubai Creek Harbour master project). Sales and rental data are available at the building/area level – for 1BR sales the data volume is sufficient, while for rentals it is available only at the area level.
2. Transaction volume and market structure
A total of 169 sales of 1-bedroom apartments in Palace Residences – North have been recorded, indicating high market activity at the early sales stage (most transactions are likely off-plan). The sales peak occurred in Q1 2023, after which volumes gradually declined. In 2024, sales are sporadic, which is typical for the final phase of a developer’s sales cycle.
3. Price dynamics per m² (sale, 1BR, building and area)
For the building (1BR, Palace Residences – North, completed sale transactions only):
- Full period of available data – since 2023.
- Average price per m² (Q1 2023): around AED 22,265.
- During 2023–2024 the average price increased, reaching AED 24,622–25,278/m² (2024).
- Over the last 12 months the average transaction price is AED 26,823/m² (for the building).
- For comparison, in Al Khairan First over the same period it is AED 25,068/m².
Long-term dynamics for the area:
- In 2020–2021 the average price per m² was in the range of AED 16,000–18,000.
- In 2022 – around AED 19,000, then from 2023 to 2024 there was steady growth to AED 22,300–25,058/m².
- Recent quarters show an acceleration of growth up to AED 27,058/m².
4. Rental market (by area, all apartments)
According to DLD data, over the last 12 months there have been no registered rental contracts for 1BR units in the building or within the master project. This is typical for new Dubai Creek Harbour complexes: the rental phase usually starts after construction completion and handover.
At the Al Khairan First area level (all residential apartments):
- Average annual rental rate per m² (last 12 months): AED 1,449/m².
- Rental growth dynamics are very strong: in Q1 2022 – AED 760/m², by the end of 2023 – already AED 1,217/m², and currently above AED 1,400/m².
- In 2024, quarterly values exceed AED 1,300/m².
Important: the resulting figure (AED 1,449/m²) is for the area as a whole, since there are still no up-to-date rental contracts for Palace Residences – North in the DLD database, either at the building or even at the master-project level.
5. Comparison of current prices (building vs area)
- Over the last 12 months Palace Residences – North has been selling at a premium to the area: AED 26,823/m² versus the area average of AED 25,068/m².
- The premium to the area is about 7%.
- Given the age of the complex and the developer’s marketing strategy, this is expected (newer apartments, Dubai Creek Harbour waterfront and the Palace brand).
6. Yield (ROI) and “fair price” assessment
The yield calculation is based ONLY on area-level data (as noted, there are no rental contracts for the building itself):
- Rough yield indicator (area-level ROI_brutto): 1,449 / 25,068 ≈ 5.78% per annum.
- Estimated “net” yield taking into account initial transaction costs (7% on deals): ~5.4% per annum (ROI_net).
- To reach a 7–8% annual target, the fair price range at current rental levels is AED 20,600–18,100/m². This is 17–28% below the current market price in the area.
The actual premium of Palace Residences – North relative to the area benchmark makes it less attractive in terms of initial rental income. This may be driven both by zero competition within the new project and by the dominance of investment purchases aimed at resale.
7. Liquidity and outlook
- Liquidity is high: the project was very popular at launch, but the secondary market has not yet fully formed (rental rates will appear after occupancy).
- The area is appreciating rapidly; demand for both rentals and purchases is steadily growing against the backdrop of large-scale development in Dubai Creek Harbour.
- Key risks for investors: the first wave of tenants, subsequent competition from new towers, and potential yield compression as prices rise.
8. Conclusion
Palace Residences – North is currently trading at a premium to the area. It is not yet possible to calculate rental income based on real building-level data: there are no recent actual contracts for the property. Based on the area benchmark, the current yield is around 5.8% at prevailing prices, which is typical for new districts at the market formation stage. To achieve a 7–8% net yield, the entry price needs to be significantly below current asking levels, or one has to rely on further growth in rental rates.
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