Costs of buying a Property in Dubai

If you’re financing your purchase with a mortgage, additional costs apply:

1. Mortgage Registration Fee
   The Dubai Land Department charges 0.25% of the loan amount, plus an AED 10 administrative fee, for mortgage registration.
2. Bank Arrangement Fee
   Banks charge between 0.5% and 1% of the loan amount, plus 5% VAT, for processing the mortgage. These fees vary depending on the lender.
3. Property Valuation Fee
   A valuation is mandatory to assess the property’s market value. This costs between AED 2,500 and AED 3,000, plus 5% VAT, and is conducted by a bank-appointed appraiser.
4. Land Department Fee
   Mortgage buyers must also pay the 4% DLD fee, plus the AED 580 administrative fee, as part of the property registration process.
5. Real Estate Agency Fee
   Similar to cash buyers, mortgage buyers pay 2% of the property value, plus 5% VAT, as the agency commission.

Post-Purchase Expenses to Budget For

Once you’ve secured your property, there are ongoing and one-time costs to prepare for:

1. Home Insurance
   Annual premiums start at approximately AED 1,000 to protect your property. Mortgage buyers may also be required to obtain life insurance.
2. Service Charges
   These are annual fees for maintaining communal areas and amenities, ranging from AED 10 to AED 25 per square foot, depending on the property type.
3. DEWA Connection Deposit
   Setting up utilities with Dubai Electricity and Water Authority requires a refundable deposit:
   • Apartments: AED 2,000
   • Villas: AED 4,000
4. Relocation and Furnishing Costs
   These vary based on your property’s size and furnishing needs but are important to include in your budget.

Pro Tips for Navigating the Costs of Buying a Property in Dubai

• Plan Thoroughly: Include all upfront and recurring costs when budgeting for your property purchase.
• Work with Licensed Professionals: Ensure you’re working with registered agents, reputable lenders, and professional conveyancers.
• Compare Mortgage Offers: Research and negotiate to secure the most competitive mortgage rates and terms.
• Stay Updated: Monitor Dubai’s real estate market trends to make informed investment decisions.

Conclusion

Understanding the costs of buying a property in Dubai is key to a successful and stress-free real estate transaction. By planning ahead and seeking advice from experienced professionals, you can navigate Dubai’s property market with confidence.

For expert guidance on property purchases and mortgage financing, contact Gulf Mortgage Advisors today. Let us help you turn your property ownership dreams into reality!