Cost to Buy Property in Dubai from the UK?
When buying property in Dubai, it is important to budget for more than just the advertised purchase price.
In addition to the cost of the property, there are Dubai Land Department registration charges, trustee and administration fees and, depending on your transaction, estate agency and mortgage-related costs.
At Black Arrow Real Estate, we explain the expected costs before you commit to a property so that you can understand your overall investment.
Dubai Land Department Registration Fee
The Dubai Land Department (DLD) sale registration charge is 4% of the property value in total.
Under the official DLD fee structure, this is allocated as 2% to the seller and 2% to the buyer. However, the parties can agree how the cost will be paid, so UK buyers should establish the agreed fee allocation before proceeding with a purchase.
Registration Trustee and Title Deed Costs
For a standard property sale of AED 500,000 or more completed through a Real Estate Registration Trustee Centre, the current service partner fee is AED 4,000 + VAT.
There are also smaller charges associated with issuing the title deed, property map and applicable knowledge and innovation fees.
The exact amount will depend on the property and method of registration.
Estate Agency Fee
For resale properties, Estate agency commission is agreed between the client and the real estate broker.
The exact commission applicable to your purchase should be confirmed before proceeding, together with any applicable VAT.
Additional Costs When Using a Mortgage
UK residents who finance their Dubai property may have additional expenses.
Dubai Land Department currently charges 0.25% of the mortgage value for mortgage registration. Buyers should also allow for potential bank arrangement fees, property valuation charges and other lender-related costs.
The exact mortgage costs will depend on the lender, property and individual circumstances.
Additional Costs When Using a Mortgage
UK residents who finance their Dubai property may have additional expenses.
Dubai Land Department currently charges 0.25% of the mortgage value for mortgage registration. Buyers should also allow for potential bank arrangement fees, property valuation charges and other lender-related costs.
The exact mortgage costs will depend on the lender, property and individual circumstances.
Example: Buying an AED 2 Million Property in Dubai
Imagine you are purchasing a ready apartment in Dubai for AED 2,000,000.
As well as the AED 2 million purchase price, you should allow for the applicable DLD registration charge, registration trustee and title deed costs, agreed estate agency commission and any mortgage-related costs if you are financing the purchase.
For this reason, we recommend that UK buyers keep a separate budget available for transaction costs rather than using their entire available capital as the property deposit or purchase price.
Before you make an offer, Black Arrow Real Estate can provide you with an estimated breakdown based on the particular property and transaction.
Example: Buying an AED 2 Million Property in Dubai
Your costs don’t necessarily end when the property is transferred into your name.
Depending on the property and how you intend to use it, you should also consider:
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Annual service charges
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Property management costs
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Maintenance and repairs
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Insurance
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Letting and tenancy-related expenses
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Mortgage payments where applicable
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Potential periods when an investment property is vacant
For an investment property, these expenses should be considered when assessing the potential net rental return rather than looking only at the headline rent.
What About Converting Pounds into Dirhams?
For UK buyers, the GBP/AED exchange rate can also have a significant impact on the final cost of purchasing a Dubai property.
A movement in sterling between reserving a property and making subsequent payments can change the amount you ultimately need to transfer from the UK.
This is particularly important with higher-value purchases and off-plan properties where payments may be spread over several months or years.
UK buyers should therefore consider both the property price and currency-transfer strategy when planning their overall budget.
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Black Arrow Real Estate can help you understand the Dubai property costs involved in your purchase, while specialist mortgage, foreign-exchange and tax advisers can provide advice relating to their respective areas.