Blog · Data deep-dive
Which city in the world gives you the best property ROI?
We stacked rental yields against price growth for 18 cities. The winner depends on one thing most rankings ignore.
Ask ten property agents which city gives the best return and you'll get ten answers, usually the city they sell in. So we did something simpler: we lined up the two things that make you money, rent and price growth, for the cities Indian investors ask us about most.
Part one: rent
Gross rental yield is the year's rent divided by the price. It tells you how hard your money works while you wait.
Rent: gross rental yield, city centre
Annual rent as % of price (indicative, crowd-sourced)
Figure 1. Source: Numbeo, read Oct 2026
Dubai and Istanbul lead with yields above 7%. Bengaluru, at about 4.3% in the centre, sits comfortably in the middle, ahead of London, Tokyo, Singapore and, notably, Mumbai at 3.0%. Hong Kong props up the table at under 2%: you buy there for capital growth, or for reasons that have little to do with rent.
A word of caution: these are crowd-sourced, indicative figures, and they are gross. Service charges, vacancies, taxes and management can take 1.5–3 percentage points off.
Part two: price growth
For growth we used Knight Frank's Prime Global Cities Index, which tracks the top end of each market over the year to June 2026. The spread is enormous: Tokyo rose 50.7%, Dubai 10.9%, Singapore 9.5% and Bengaluru 4.5%. At the other end, London fell 3.6% and Toronto 7.3%. Knight Frank's head of research summed it up in four words: performance remains highly differentiated
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Part three: put them together
Rent plus growth: a rough one-year scorecard
| City | Rental yield | Prime price change | Rough total | In rupee terms? |
|---|---|---|---|---|
| Dubai | 7.4% | +10.9% | ~18% | Dirham pegged to US$: helped by rupee fall |
| Tokyo | 3.1% | +50.7% | ~54% | Volatile; yen weak |
| Singapore | 2.9% | +9.5% | ~12% | Strong currency |
| Bengaluru | 4.3% | +4.5% (prime) / +8–9% (city) | ~9–13% | No currency risk |
| Lisbon | 4.5% | +4.5% | ~9% | Euro |
| Madrid | 3.6% | +3.7% | ~7% | Euro |
| New York | 5.3% | −0.4% | ~5% | US$ |
| London | 3.4% | −3.6% | ~0% | Sterling |
| Toronto | 4.2% | −7.3% | ~−3% | Canadian $ |
Figure 2. Source: Numbeo yields (gross, centre); Knight Frank Prime Global Cities Index Q2 2026. Gross, before costs and taxes; one year is not a trend.
Add a year's rent to a year's price change and Tokyo looks like the runaway winner, followed by Dubai, then a cluster including Singapore, Bengaluru and Lisbon. London and Toronto, once the gold standard of global property, barely moved or went backwards.
But we wouldn't wire money to Tokyo tomorrow. Here's why.
The thing most rankings ignore: currency
Every number above is in local currency. An Indian investor lives in rupees. In 2026 the rupee has weakened sharply (one US dollar now buys about ₹97), so any asset in dollars or dirhams has looked better in rupee terms, regardless of what the property did. Dubai's dirham is pegged to the dollar; Singapore's dollar has been strong. Both gained extra shine for Indian owners.
The reverse is also true. The yen has been weak for years, so a big part of Tokyo's local-currency gain shrinks when you translate it. And if the rupee recovers, the extra boost on foreign assets reverses with it.
The best-performing city of the year is rarely the best investment of the decade.
The second thing: one year is not a trend
Tokyo's 50.7% came after an 8.6% fall in the previous quarter. Dubai's 10.9% prime gain sits alongside a broader 10% price correction earlier this year. Markets that leap tend to stumble. For a long-term investor, steadiness matters as much as speed.
The third thing: costs to enter and exit
A 7% yield sounds wonderful until you pay 4% to the land department, 2% to an agent and service charges every year. A 12% price rise in Spain has to first cover transfer taxes of up to 11%. Bengaluru's roughly 6–7% purchase cost is moderate by global standards.
So which city wins?
- For income: Dubai, with Istanbul a high-risk alternative given Turkey's inflation (house prices there rose 25% before inflation but fell 5% after it).
- For growth in a strong currency: Singapore, though entry restrictions and stamp duties for foreigners are steep.
- For balance with no currency risk: Bengaluru, a middle-of-the-table yield with growth driven by real jobs.
- For speculation: Tokyo, but only if you understand the yen and can stomach big swings.
How we did it
We combined two data sets. Rental yields come from Numbeo, a crowd-sourced database: useful for comparing cities, but not precise for a specific building. Price growth comes from Knight Frank's Prime Global Cities Index, which tracks the luxury end of 46 cities. Mixing the two isn't perfect: a city-centre yield and a prime price change describe slightly different homes. Treat the scorecard as a compass, not a GPS.
The hidden ROI killers
- Transaction costs: from about 4% in Dubai and 6–7% in Bengaluru to 10% or more in parts of Europe, and far more for foreigners in Singapore, where additional stamp duties for overseas buyers are punitive.
- Holding costs: property tax of 1–2.5% a year in many US states, service charges in Dubai, community fees in Spain.
- Tax on rent: zero in the UAE, but your rent is still taxable at home if you're a resident Indian.
- Vacancy: a month empty each year cuts an 8% yield to about 7.3%.
- Leverage: mortgages magnify returns both ways, and with rates higher in 2026 (7.3% in the US, 4.6% for Australia's central bank, 5.5% repo in India), borrowing costs more everywhere.
A five-year lens, not a one-year one
If you only remember one thing, make it this: one-year rankings reward momentum, but property is a five- to ten-year asset. Over that horizon, the cities that win tend to share a few traits: growing jobs, limited new supply, stable rules for foreigners and a currency that isn't falling apart. Bengaluru scores well on jobs, Dubai on yield and openness, Singapore on stability, Tokyo on momentum. Nobody scores perfectly.
What about Indian cities?
Within India, Mumbai's rental yield of about 3% is lower than Bengaluru's 4.3%, and Delhi's centre is similar to Mumbai's. Bengaluru's mix of IT jobs and relatively lower price-to-income ratio (about 8, versus 27 in Mumbai on Numbeo's measure) is why many investors see it as India's best balance of yield and growth.
The full 18-city picture
Beyond the cities in our scorecard, a few others are worth noting. Kuala Lumpur offers gross yields of about 3.4% in the centre and over 5% outside, with modest price growth. Bangkok yields about 3% with flat prime prices. Manila saw prime prices jump 14.6% but yields under 4%. Athens yields about 3.9%, with national prices up about 5.8% before inflation. Sydney yields about 4.3% but prices have fallen through 2026 as interest rates rose. Hong Kong remains the lowest-yielding major city, at about 1.9%.
A rupee investor's ROI checklist
- Start with net yield, after realistic costs, not gross.
- Add a conservative price-growth assumption, below the latest year.
- Subtract entry and exit costs, spread over your holding period.
- Ask what happens to your return if the rupee strengthens 10%.
- Check the rules: can you rent it, sell it and bring money home easily?
- Compare against a simple Bengaluru alternative with no currency risk.
If the overseas option still wins after all six steps, it may be worth pursuing.
Questions readers ask us
Is Istanbul really a 7% yield? In lira, yes. But Turkish house prices rose about 25% last year before inflation and fell about 5% after it, so in real terms owners lost ground. High yield in a high-inflation currency is not the same as high return.
Should I chase Tokyo? Tokyo's condo prices have hit records, with the 23 central wards averaging about ¥179 million for new condos in April to September 2026. Rising interest rates in Japan and a volatile yen make it a market for informed, patient investors.
Can I calculate this for my own property? Yes. Our return calculator now includes purchase and selling costs and shows a true annual return (IRR).
The Honour Estates view
There's no single best city, only the best city for your currency, timeframe and tolerance for swings. For a rupee-based investor, a core holding in Bengaluru plus a smaller high-yield dirham asset in Dubai has been a hard combination to beat this year. Try your own numbers in our return calculator.
Sources
- Numbeo property investment rankings
- Knight Frank Prime Global Cities Index Q2 2026
- BIS residential property price statistics
- Khaleej Times on ValuStrat Q2 2026
Figures are the latest published at the time of writing (4 November 2026). Quotes are short excerpts with attribution. This article is general information, not financial, legal, tax or immigration advice.
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