Property purchase costs in Dubai: what to budget for

The advertised price of a property in Dubai is not the total cost of the acquisition. Several costs are added, known in advance and easy to include in a budget.

Dubai Land Department registration fees

The main item is the property transfer fee, equal to 4% of the property value. It applies to both off-plan purchases and resales, along with a few low-value administrative fees. On some new projects, the developer may offer to cover all or part of it as part of a commercial offer.

The agency commission

On the secondary market, the agency commission is frequently 2% of the price, plus 5% VAT. On new projects, the remuneration is generally paid by the developer and is not added to the price paid by the buyer.

Trustee office fees

A transfer of ownership on the secondary market is completed at an approved trustee office, which charges fixed fees, in the order of a few thousand dirhams depending on the value of the property.

If you take out a mortgage

Financing brings specific costs: bank arrangement fees, property valuation, registration of the mortgage with the Dubai Land Department (calculated on the amount borrowed) and insurance, notably life and home insurance.

Annual charges

Once you own the property, service charges cover the maintenance of common areas, security and facilities. They vary greatly from one building to another and are calculated by surface area. Water, electricity and, depending on the district, centralised air conditioning are added.

A budget example

For an apartment bought at AED 1,000,000, registration represents AED 40,000. On the secondary market, a 2% commission adds AED 20,000 excluding VAT, which puts the acquisition cost about 6% above the advertised price, before any mortgage or trustee fees.

Plan ahead rather than suffer

Comparing two properties on price alone often leads to mistakes: it is the price, the fees and the annual charges taken together that determine the real return.

To review your project and check the conditions currently in force, book an appointment with Arzouni Properties.