The transfer fee
The Dubai Land Department charges 4% of the purchase price to register the transfer, plus an administrative fee of roughly AED 4,200 to 5,250 depending on the property type, and about AED 580 for the title deed. In principle the 4% is split between buyer and seller; in practice almost every standard agreement in Dubai passes the whole amount to the buyer.
The agency commission
The market standard is 2% of the purchase price, plus 5% VAT on the commission itself — about 2.1% all in. It is negotiable on larger transactions and rarely negotiable on small ones.
If you are using a mortgage
- Mortgage registration with the Land Department: 0.25% of the loan amount, plus a small fixed fee.
- Bank valuation of the property: roughly AED 2,500 to 3,500.
- Bank arrangement fee: typically up to 1% of the loan, often negotiable.
- Life and property insurance, charged annually for the life of the loan.
This is why a mortgaged purchase is usually quoted at 8–9% over the price where a cash purchase sits nearer 7–8%.
The costs that start on handover day
A DEWA deposit of AED 2,000 for an apartment or AED 4,000 for a villa is refundable when you close the account. The service charge is not: it is an annual per square foot amount set for the building, and it runs from roughly AED 8 per square foot in a simple tower to AED 45 or more in a building with extensive amenities.
| Line | Typical amount | Who pays |
|---|---|---|
| DLD transfer | 4% of price | Buyer, in practice |
| DLD admin + title deed | AED 4,800–5,800 | Buyer |
| Agency | 2% + 5% VAT | Buyer |
| Mortgage registration | 0.25% of loan | Buyer |
| Valuation | AED 2,500–3,500 | Buyer |
| DEWA deposit | AED 2,000 / 4,000 | Buyer (refundable) |
| Service charge | AED 8–45 per sqft / year | Owner, every year |
A worked example
On a completed AED 1.5 million apartment bought in cash: AED 60,000 transfer, about AED 5,300 in DLD admin and title deed, AED 31,500 agency including VAT, AED 2,000 DEWA deposit. That is roughly AED 98,800, or about 6.6% — before the first service charge invoice, which on a 900 square foot unit at AED 18 per square foot is another AED 16,200 a year.
What to ask before you commit
- 1Ask for the building's current service charge per square foot, in writing, not an estimate.
- 2Ask whether the seller has any outstanding service charge — an unpaid balance blocks the NOC you need to transfer.
- 3If there is a mortgage on the seller's side, ask how long clearance will take; it sets your real timeline.
- 4Confirm who pays the 4% in your MOU, in that sentence, before signing anything.
Is there an annual property tax in Dubai?
No. There is no recurring property tax on ownership. The recurring cost of ownership is the service charge, plus utilities, plus the 5% municipality fee that appears on residential rental bills for tenants.
Can the fees be added to the mortgage?
Generally not. Banks lend against the property value; the transfer fee, commission and registration costs are expected in cash on transfer day.
Do off-plan purchases work the same way?
The 4% registration still applies, but it is usually paid at the initial Oqood registration rather than at handover, and there is no agency commission when you buy directly from the developer.
This article is general information, not legal or financial advice. Rules change — confirm your own position with a qualified professional before deciding.
