How Much Home Can I Afford in Dubai? Mortgage Affordability Guide & Calculator

Buying a property in Dubai is exciting, but the first question every buyer asks is:

How Much Home Can I Actually Afford in Dubai?

To answer this, you need to calculate your upfront costs, down payment, mortgage eligibility, and monthly affordability. Here, we will break it down in a clear Q&A format so you can confidently plan your Dubai property purchase. Knowing your potential property’s monthly expenses will also help you focus on looking for home prices within your budget.

You don’t want any surprises later on and end up with ‘too much’ house.

What Are the Upfront Costs When Buying a Home in Dubai?

If you’re a cash buyer or taking a mortgage in Dubai, you’ll need to budget an additional 7–8% of the property price for upfront costs with buying a property.

Typical upfront costs include:

Dubai Land Department (DLD) fees: 4% of property price + AED 580 admin fee
Property Registration Fee: AED 2,000 (below AED 500,000) or AED 4,000 (above AED 500,000)
Mortgage Registration Fee: 0.25% of the loan amount + AED 290
Real Estate Agent Fees: 2% of property price + 5% VAT
Conveyance Fee: AED 6,000 – AED 10,000
Home Insurance: ~ AED 1,000 annually
Home Inspection: AED 1 per sq ft
Life Insurance: 0.4-0.8% per annum (on decreasing loan balance)

Note: On top of this, factor in foreign exchange transfer fees if sending money from abroad. These miscellaneous fees can often add up more than you expected, so plan for them.

Answer: Always add 7–8% of the property price to estimate the real purchase cost in Dubai.

Do I Need a Mortgage in Dubai?

You have 3 main options:

Cash Purchase: Full property price + 7–8% upfront costs. No loan, no interest.
Mortgage Loan: Pay a down payment (minimum 20% for expats, 15% for UAE nationals on properties under AED 5M).
Combination of Cash & Mortgage: Pay a larger down payment and finance the rest with a mortgage to reduce interest costs.

Answer: If you want liquidity, a Dubai mortgage loan may be smarter. If you prefer zero debt, go with cash. It comes down to how much cash you have on hand, how much you want it to be tied up to a property, and what you’re comfortable with.

What is the 30% Income Rule for Mortgage Affordability in Dubai?

Generally speaking, never spend more than 30% of your monthly income on housing costs (mortgage, service charges, and insurance). This rule safeguards you from overspending.

Example: If your salary is AED 15,000 per month. Your monthly housing payment should not exceed AED 4,500 a month.

Answer: Stick to the 30% rule to avoid overspending and financial stress.

Keep in mind:
1. Minimum monthly income for UAE mortgages is AED 15,000 (salaried) and AED 25,000 (self-employed), though some banks accept lower amounts.
2. UAE Central Bank law limits total debt payments to 50% of your income (i.e. mortgages, credit card payments, and car loans, etc.)

What are the UAE Mortgage Cap’s Loan-To-Value (LTV) Ratios?

The Central Bank of UAE regulates how much you can borrow:

For Expats (UAE Residents and Investor Overseas)

First Property (≤ AED 5M): 80% LTV, 20% down payment

First Property (> AED 5M): 70% LTV, 30% down payment

Second Property: 60% LTV, 40% down payment

Off-Plan Property: 50% LTV, 50% down payment

For UAE Nationals

First Property (≤ AED 5M): 85% LTV, 15% down payment

First Property (> AED 5M): 75% LTV, 25% down payment

Second Property: 65% LTV, 35% down payment

Off-Plan Property: 50% LTV, 50% down payment

Answer: Expats usually need a 20% down payment, while UAE nationals need only 15% (for homes under AED 5M).

How Much Home Can I Afford?

Let’s run a sample calculation using a Mortgage Calculator Dubai:

Monthly salary: AED 15,000
Max home budget (30% rule): AED 4,500/month
Down payment: 20% (expats, for property ≤ AED 5M)
Interest rate: 3.99% fixed
Loan tenure: 25 years

You can afford a property worth around AED 628,000 (about 2,009 sq. ft apartment with AED 10/sq. ft service charges).

Answer: Use a Dubai mortgage calculator to adjust figures for your income, down payment, and interest rate and figure out which combination works best with your budget. If you can’t buy a property and pay for all these extra interests and fees, don’t buy one yet.

Tip: A mortgage pre-approval from a bank or mortgage broker will also help determine properties within your price range and help avoid any potential budget discrepancies.

Can Overseas Investors Get a Mortgage in Dubai?

Yes. Non-residents can apply for non-resident mortgages in Dubai, but with restrictions:

Typically allowed to borrow up to 50% of the property price
Criteria vary depending on bank, income, and country of residence

Answer: Non-residents can finance Dubai property purchases, but approval is stricter and down payments are higher.

Why Should I Get Mortgage Pre-Approval in Dubai?

If you plan to apply for mortgage, you will need to get a mortgage pre-approval from the bank or a mortgage broker. This pre-approval guarantees the bank will offer you a mortgage later on.

Pre-approval is a must-have before house hunting:

Sellers prefer buyers with pre-approval. Sellers like serious buyers!
Prevents surprises if a bank later rejects your loan.
Speeds up the transaction – Agents treat your request more seriously. They know they can sell their property faster.

Answer: Always get Dubai mortgage pre-approval valid for 60 days to secure the best deal.

To get pre-approved, banks and mortgage brokers will check your credit history and finances to ensure that you have sufficient funds and a good track record of paying back.

Key Takeaways – How Much Home Can I Afford in Dubai?

Use a Dubai mortgage calculator and get pre-approval before property search.
Always budget 7–8% extra for upfront costs.
Minimum down payment = 20% (expats), 15% (UAE nationals).
Follow the 30% income rule to calculate monthly affordability.
Expats can finance up to 80% of property value for first home.
Non-residents can finance up to 50% with certain banks.