Keep In Mind Dubai Property Purchase Costs, DLD Service Charges & Extra Fees
No income tax. No property capital gain tax. No rental income tax. No inheritance tax. Dubai can easily be recognized as one of the best cities for buying property. But here’s the truth. Dubai property purchase costs can get expensive. Between DLD Service Charges, Oqood fee, and repairs, those bills can add up.
And don’t forget, there are associated costs that come with buying a property. Typically, it includes a 4% transfer fee, a few one-time registration fees, and VAT taxes, so be prepared to set aside 7%-8% additional to your property value.
Now, let’s count up all the costs.
Dubai Property Purchase Costs (Cash or Mortgage Buyer)
|Dubai Land Department Transfer Fee||4% of purchase fee + AED 580 administrative fee for apartment/office/villa, AED 430 for land|
|Oqood Fee (for off-plan properties)||4% of purchase price + AED 40 administrative fee |
+ AED 5,250 for Oqood Certificate
|Property Registration Fees||AED 2,000 + 5% VAT for property below AED 500,000|
|Property Registration Fees (cont.)||AED 4,000 + 5% VAT for property above AED 500,000|
|Agency Commission Fee||2% of purchase fee + 5% VAT|
|Conveyancing Fees||AED 6,000 to AED 10,000|
|Home Inspection Fee||AED 1 per sq. ft|
Dubai Property Purchase Costs (with Mortgage Loan)
|Dubai Land Department Mortgage Fee||0.25% of loan + AED 290 fee|
|Bank Mortgage Arrange Fee||Up to 1% of loan amount + 5% VAT|
|Valuation fee||AED 1,850 to AED 3,500 + 5% VAT|
|Home Insurance||0.03% – 0.06% of property value + 5% VAT (annual)|
|Mortgage Life Insurance||0.01167% – 0.0245% of loan amount (monthly)|
|Bank Fees||i.e. wire transfer & exchange rate fees|
Homeowner Annual Costs / Upfront Deposits
Besides your mortgage payments (if any), here are other annual charges and deposits to factor in as a homeowner:
|DLD Service Charges||Can range from AED 2 to AED 30 per s.ft per month depending on the area.|
|Chiller Charge||For owner-occupied, check if chiller charge is included: |
– If not, chiller charge will be billed separately
– If they are, it’s known as “chiller free”
|Sinking Fund Deposits||Up to 6 months of monthly Service Charges|
|DEWA Security Deposits||AED 2,000 for apartment (Residential Premises)|
AED 4,000 for villa (Residential Premises)
For non-residential premises, security deposit is calculated based on the premise’s consumption.
|DEWA Activation Charges||AED 100 for connecting electricity and water (small meters)|
AED 300 for connecting Electricity and water meters (large meters)
AED 10 for registration
AED 10 for knowledge fee
AED 10 for innovation fee
|Home Insurance||Starting from AED 450 + 5% VAT|
|Mortgage Life Insurance||Based on Individual Profile|
Have a property in mind? Use this handy mortgage calculator below. It calculates all the costs we covered in this article and customizes the service charge based on the size of your property.