Dubai's real estate market is thriving, with increasing interest from both international and local investors. If you're considering purchasing a property in this bustling city, it's important to understand the various costs and fees associated with buying a home. Here's a comprehensive guide outlining the additional expenses you should be aware of when entering the Dubai property market.

Standard transaction fees

All real estate transactions in Dubai are subject to a fee from the Dubai Land Department (DLD), which amounts to 4% of the property's purchase price. This fee covers the property transfer tax and related administrative costs.

Sale registration fees

When you purchase a property in Dubai, there is a 2% registration fee on the sale value, typically split between the buyer and the seller. Additional fees apply depending on the type of property and other specifics:

• AED 250 for a unit or villa registration.

• AED 100 for a land plot map for properties outside Dubai Municipality.

• AED 225 for a unified land plot map with Dubai Municipality.

• AED 10 for knowledge fees, and AED 10 for innovation fees for each document.

Service partner fees

Service fees vary depending on the sale value:

• If the sale value is 500,000 AED or more, a fee of 4,000 AED plus 5% VAT applies.

• If the sale value is less than 500,000 AED, a fee of 2,000 AED plus 5% VAT is required.

Dubai mortgage fees

If you are obtaining a mortgage, expect additional fees. The DLD charges 0.25% of the mortgage amount, plus an additional 290 AED for mortgage registration. Banks also impose a 1% fee on the loan amount plus 5% VAT. The cost of the property valuation process is approximately 3,500 AED.

Real estate agent commission

If you're working with a real estate agent, expect to pay around 2% of the property's sale price plus 5% VAT as a commission. This fee may vary depending on the agency involved.

Title deed acquisition

A fee of 520 AED is required to obtain the title deed after the property transfer is complete.

Additional costs

Owning a property in Dubai involves other costs beyond the initial transaction fees:

• Maintenance charges depend on the type and size of the property.

• Annual service fees are determined by various factors related to property upkeep.

Tips for first-time buyers

Here are some key steps to help first-time buyers navigate the Dubai real estate market:

• Research: Start by exploring the available options, setting a budget, and understanding the administrative costs involved.

• Hire a Broker: A reputable broker can guide you through the buying process, offer impartial advice, and assist with property viewings and negotiations.

• Property Viewings: Visit multiple properties to understand your options and ensure you're getting value for your investment.

• Memorandum of Understanding (Form F): Sign this agreement with the seller to outline the agreed price and terms of the sale.

• No Objection Certificate (NOC): This certificate confirms that all fees have been settled and allows the sale to proceed.

• Ownership Transfer: Once the NOC is obtained, the DLD processes the property transfer, officially changing ownership from the seller to the buyer.

• Handover: Complete any remaining payments, connect utilities, and finalize service fees to complete the property transfer.

Buying a property in Dubai involves various fees and costs, which are essential to understand before making a purchase. By knowing these fees and following the right steps, first-time buyers can navigate the Dubai real estate market with confidence and avoid unexpected expenses.