Dubai is a low-tax market — no annual property tax, no personal tax on rental income, no capital gains tax on an individual's sale — but it is not a no-cost one. The purchase itself carries a set of fees that together come to around 7% to 8% of the price on a ready property and around 4.5% on an off-plan purchase from a developer, before any mortgage costs. This article lists them, says who conventionally pays each, and notes where the figure is a fixed rule and where it is a market habit.
The Land Department transfer fee
The Dubai Land Department charges a transfer fee on every sale, currently 4% of the purchase price, plus an administration fee (currently AED 580 for an apartment or villa) and small knowledge and innovation fees. The regulation describes the 4% as shared between buyer and seller; by market convention the buyer pays all of it. On an off-plan purchase it is paid at Oqood registration, near the start; on a ready purchase, at the trustee office on the day of transfer. Some developers run promotions that absorb it — a real discount, worth having, and not a reason to buy.
Fees on a ready purchase
- Registration trustee fee: the licensed office that processes the transfer and issues the title deed. Currently AED 4,000 plus VAT on properties of AED 500,000 and above, AED 2,000 plus VAT below; often split with the seller by agreement.
- Agency fee: 2% of the price plus 5% VAT by market convention, paid by the buyer to the broker representing them. The seller pays their own broker separately.
- Developer no-objection certificate: confirms the seller's service charges are paid; currently AED 500 to 5,000 depending on the developer. Conventionally the seller's cost.
- Deposit: 10% of the price on signing the memorandum of understanding, held by the broker and applied to the price at transfer. Not a fee, but cash you need early.
Two of these are negotiable in practice and two are not. The trustee fee is often split by agreement and the agency fee can be discussed, particularly on higher-value transactions; the Land Department fee is not negotiable, and the 10% deposit is a convention so settled that a seller will rarely accept less.
Fees on an off-plan purchase
- Oqood registration: the interim registration of your contract in your name. Developers typically quote around AED 3,000 including their own administration; the figure varies, so treat it as an estimate.
- No trustee fee, because the developer registers the sale directly; and typically no buyer-side agency fee, because the developer pays the broker.
- Handover fees at completion: utility connection, community registration, access cards. Ask for an itemised list and check which are in the sale agreement.
The lighter fee load is a real advantage of buying from a developer, worth roughly 2.5% of the price against a ready purchase through a broker. It is also the reason developers can present the plan as the whole cost. It is not, and the 4% at the start is the reminder.
The plan is the price. The fees are the price of the price. Budget for both on the same day.
If you borrow
A mortgage adds the Land Department's mortgage registration fee — currently 0.25% of the loan amount plus AED 290 — paid at transfer, the bank's valuation fee (typically AED 2,500 to 3,500 plus VAT), and the bank's arrangement fee, often up to 1% of the loan and set by each lender. Non-residents are currently offered lower loan-to-value ratios than residents — often 50% to 60% of the price — and off-plan lending is capped lower still, so the equity you need is larger than the headline rate suggests.
After the purchase
From handover or transfer, service charges are invoiced against the RERA-approved budget; utility deposits are paid to DEWA (currently AED 2,000 for an apartment and AED 4,000 for a villa) and to the cooling provider where there is one; and if you let the property, Ejari registration and a management fee. Tenants, not owners, pay the 5% municipality housing fee through their utility bill. None of this is a purchase cost, and all of it starts the month you own the property.
It is worth setting aside the first year of running costs at the time of purchase rather than at handover, because in a new district they can arrive before the first rent does. On a 1,200-square-foot apartment that means roughly AED 20,000 to 30,000 of service charges and cooling in the first year, before a tenant has signed.
Worked example
On a AED 2,000,000 ready apartment bought with cash through a broker: the DLD fee is AED 80,000 plus AED 580 and the small fees; the trustee fee AED 4,000 plus VAT; the agency fee AED 40,000 plus VAT; the NOC, if you have agreed to pay it, somewhere between AED 500 and 5,000. Roughly AED 127,000 on top of the price, or about 6.4%, before any mortgage costs. The same unit bought off-plan from the developer: AED 80,000 plus the administration charge and around AED 3,000 for Oqood — roughly AED 84,000, or 4.2%. The cost-of-buying tool runs this on any price you enter, with each row explained.