UAE rental yields may indicate growing imbalances, overheating

DUBAI, June 8 Sun Jun 8, 2014 2:14am EDT

DUBAI, June 8 (Reuters) - Residential rental yields in Dubai and Abu Dhabi could indicate growing imbalances and overheating in the country's real estate sector, the United Arab Emirates central bank said on Sunday.

"Current average rental yields in Dubai and Abu Dhabi are approximately 70 and 130 basis points below historical averages, which could indicate growing imbalances - overheating real estate market," it said in a financial stability report.

"Monitoring development in the UAE real estate markets and the banks' exposure to it remains a core financial stability priority," it added. (Reporting by Martin Dokoupil; Editing by David French)