The majority of people who have chosen to make Dubai their home ultimately have the goal of settling down in “a place of my own.” Historically, the city only allowed the expat population to rent properties, which left them with a very limited selection of living arrangements to choose from. The development of freehold properties in Dubai made the goal of purchasing a home in the emirate more attainable for a large number of people.
Due to the historically high cost of real estate, acquiring a home in Dubai was historically out of reach for a large portion of the population. On the other hand, as a result of the development of housing options that fall within an affordable mid-market range and the gradual decline in prices to entry points that are more appealing, it is currently more beneficial financially to purchasing a Home in Dubai rather than rent in the current market. In some cases, not only are monthly mortgage repayments lower than monthly rents, but there is also the added advantage of capital growth on your asset. In other words, mortgages tend to be a better financial investment.

Having said that, in order for buyers to be able to make an educated financial decision, it is essential information for them to have ahead of time accurate knowledge of the true costs associated with purchasing a home, costs that go beyond simply the monthly payment on the loan. There are a variety of fees that must be paid to various entities, including the Dubai Land Department (DLD), which is a government agency; real estate agents or developers; mortgage lenders and conveyancers; and mortgage lenders. The following outlines them for you.
Government Fees
1. Dubai Land Department (DLD) Fees |
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4% of the purchase price + AED 580 admin fee for apartments and offices or AED 430 for land or AED 40 for off-plan |
2. Property Registration Fee |
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For properties valued below AED 500,000: AED 2,000 +5% VAT For properties valued above AED 500,000: AED 4,000 + 5% VAT |
3. Dubai Land Department Mortgage Registration Fees |
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0.25% of the loan amount + AED 290 |
All purchases made in Dubai are required to be registered with the DLD within sixty days after the date of the transaction. If the buyer fails to register their transaction within sixty days, the purchase would be considered null and void. In practise, however, the buyer is responsible for paying the whole 4% of the DLD’s fees, despite the fact that the 4% should, in theory, be split evenly between the buyer and the seller. The expense of the Property Registration Fee is also the responsibility of the buyer.
When a buyer purchases a home with the assistance of a bank loan, the buyer is responsible for paying an additional fee to the DLD in the amount of 0.25% of the total loan amount in order to register the mortgage against the property. This expense does not apply to a buyer who pays cash for the property.
Agency Fees
1. Real Estate Agent Fees |
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2% of the purchase price + 5% VAT |
2. Conveyance Fee |
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Approximately AED 6,000 to AED 10,000 |
Although using the services of a real estate agent will add 2% plus VAT to the cost of purchasing a property (which is payable upon the successful conclusion of the deal), working with the correct agent can make the process go much more quickly and easily. When you work with a certified agent, you can rest assured that you will receive the best advise throughout your trip, beginning with the Dubai property market and continuing all the way to the community you are purchasing into or the developer of the property.
An agent will also assist you throughout the entirety of the purchase process, from beginning to end, ensuring that you are kept informed at every step of the way and are aware of any associated charges. The buyer is also responsible for paying any necessary conveyancing fees. If you hire a qualified conveyancer, you won’t have to worry about whether or not the paperwork, contracts, or financial arrangements related with the transaction are in compliance with applicable laws.
A conveyance fee is an additional cost that falls on the buyer when the buyer makes use of the services and support of a conveyancer. The total can range anywhere from 6,000 to 10,000 UAE Dirhams. A conveyancer is someone who guarantees that all of the legal terms and contracts are written accurately in accordance with the law of the UAE, thereby preserving the interests of all parties concerned.
Mortgage Fees
1. Bank Mortgage Arrangement Fee |
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1% of the loan amount + 5% VAT |
2. Property Valuation Fee |
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Between AED 2,500 – AED 3,500 + 5% VAT |
The fees described above are those that must be paid to the bank by purchasers who finance their purchase with a mortgage. To alleviate the strain of the first monetary outlay, certain financial institutions grant buyers the ability to add these up-front fees to their mortgage.
When purchasing a home from a seller who has a mortgage on the property, it is essential to keep in mind that the buyer will initially be required to pay off the seller’s mortgage in order to be granted a No Objection Certificate (NOC), which is required for the buyer to be able to complete the property transfer process with the DLD. It is stated in the NOC, which is a legal certificate, that the seller has paid all service charges and other costs, and that the developer does not have any objections to the sale being completed.
Initial Deposit
The buyer is required to make a deposit to secure the acquisition in all transactions, regardless of whether they take place on the primary or secondary market. The initial deposit for ready property acquisitions made on the secondary market is normally 10% of the purchase price, and it is written out as a check to be given to the seller. The authorised agent, who must be an RERA-registered broker, is the one who collects this sum and keeps the deposit in escrow until the property is successfully transferred.
Again, in cases where an existing mortgage is registered against the property, the purchaser is required to pay off the mortgage in full before submitting an application for a No Objection Certificate (NOC), which is necessary in order to acquire the Title Deed for the property.
Service Fees
After the completion of the transaction and the transfer of ownership of the property, there is an extra expense, known as service fees, that must be taken into consideration.
The RERA Service Charge and Maintenance Index is used to determine the annual maintenance fees that must be paid to the Dubai Land Department for a given property. This index, which differs from community to community, calculates a certain rate per square foot.
The DLD’s website is the best place to find up-to-date information on fees. This payment makes a contribution toward the maintenance of the common spaces of a building or community, such as elevators, landscaping, security, swimming pools, and other such amenities.
Insurance Fees
1. Home and Contents Insurance |
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Approximately AED 1,000 |
2. Life Insurance |
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Approximately 0.4-0.8% per annum on the decreasing loan balance |
Although insurance for one’s home is not required in Dubai, it is strongly recommended. Insurance for both the structure and its contents can safeguard homeowners and their belongings in the event that they are stolen, involved in an accident, or suffer damage as a result of a fire or other natural disaster.
When applying for a mortgage in the UAE, borrowers are required to have life insurance. The monthly premiums for life insurance are a reoccurring expense that comes with owning a property that is financed, and this is an expense that has to be accounted for in your budget. The vast majority of financial institutions levies this fee on a monthly basis, apart from the loan itself.
In general, banks impose an annual fee that ranges from 0.4% to 0.8% of the outstanding mortgage debt, and some banks require that the policy’s premium be paid in full before the insurance may be issued. In most cases, financial institutions have their own own in-house life insurance policy, which is typically underwritten by one of the big international life insurance companies.
However, purchasing an external life insurance policy is likely to be the most cost-effective option; this is especially true if you are still young and in good health. There are a variety of scenarios and conditions, and the bank or another mortgage provider would be able to advise you on the available choices.
