Purchasing an apartment in Dubai is an exciting opportunity, but it’s essential to thoroughly analyze all associated costs before making a decision. While the property price is commonly the most discussed figure, there are multiple hidden expenses that may significantly impact your budget.
To ensure a smooth purchasing process, here’s a breakdown of the key costs you should keep in mind when you buy apartment in Dubai.
Registration Fees
After selecting your dream apartment, registering the property with the Dubai Land Department (DLD) is mandatory. The DLD registration fee is calculated at 4% of the property’s purchase price, and it is typically paid at the time of transferring ownership. Additionally, there may be a small administrative fee payable during the same process. These charges might come as a surprise but are unavoidable for securing your property legally.
Real Estate Agent Fees
If you’ve worked with a real estate agent to find your apartment, you’ll likely need to pay their commission. This typically amounts to around 2% of the property price, although it can vary depending on the agent and the agreement. Ensure that you understand the terms of this payment upfront and include it in your budget.
Maintenance Charges
Once you’ve settled into your apartment, maintenance costs will become part of your annual expenses. Property developers in Dubai charge these fees to cover the upkeep of communal spaces, such as pools, gyms, and parking areas, as well as security services. The charges are usually calculated per square foot of your property, so larger apartments incur higher fees.
Mortgage-Related Costs
If you’re financing your purchase through a bank, be prepared for extra costs related to your mortgage. These include processing fees, which are usually a percentage of the loan amount. Additionally, there will be valuation fees, as the bank needs to assess the property’s worth before approving your loan. Reviewing these costs thoroughly with your lender is critical for financial planning.
Utility Deposits
Before moving into your new apartment, utility connections must be set up. Dubai Electricity and Water Authority (DEWA) requires a security deposit, which varies depending on the size of your apartment. This deposit is refundable when your tenancy ends, but it’s still an upfront cost to consider.
Service Fees and Other Charges
Beyond maintenance costs, some developments may impose separate service fees for amenities like air conditioning or additional facilities. Reviewing your developer’s contract carefully will help you identify any non-obvious charges that may arise.