Dubai Real Estate Taxes and Fees

It is quite natural that each real estate purchase is accompanied by numerous fees and taxes. Let’s consider which taxes and fees are provided by real estate law in Dubai to prepare for a successful investment in local properties.

Sales Tax in Dubai for Real Estate Deals

In general, real estate law in Dubai is loyal to foreign investors. That is reasonable because the government of the Emirate is interested in the engagement of new investors. Today, when you conclude a deal and purchase any type of residential property in Dubai, you ought to pay quite moderate taxes and fees which are as follows:

  • The main sales tax in Dubai is called a Property Transfer Fee, and it is paid to the Dubai Land Department for the support of the process of property transfer from a previous owner to a new one. It differs in different emirates, and in Dubai, it is 4% of the property’s price. Who pays that tax, you may ask? Sometimes, DLD costs are distributed between a seller and a buyer to pay 50% each. Yet often a buyer takes all expenses on their own.
  • When you apply for a title deed, which is your main document of ownership, you have to pay 10% of the property’s price as a deposit which returns to you after the whole payment is transferred.
  • If you buy a property for a mortgage, a bank can claim a mortgage fee, which should also be paid.
  • Insurance fees also can impact the total cost of your property. Although in Dubai, residential insurance is not obligatory, it is strongly recommended to apply for an insurance plan for new investors. The fee depends on the insurance operator and your property’s specifications.

Are There Housing Fees for Owners in Dubai?

There is good news for housing owners as there is no annual property tax in Dubai. Yet, there are some types of housing fees for owners in Dubai you should be aware of.

  • Property service charges are also referred to as annual maintenance costs for a bought property. That fee is flexible, and it depends on the property type, the list of maintenance services provided, and even on the location as in different districts of Dubai service fees vary greatly.
  • The DEWA fees are paid to Dubai’s Electricity and Water Authority. They also vary and depend on multiple factors. Thus, it is better to indicate their levels at the stage of agreeing with a developer or even when you select the unit to purchase.

Due to logical and democratic governmental policy for real estate investments, Dubai remains one of the cheapest cities for investing in residential property. Generally, it is a tax-free zone for real estate investors, and its transfer and registration commissions are among the lowest in the world. Yet you shouldn’t forget about regular housing fees, which can be quite costly, depending on the property type and location. To avoid this pitfall, better apply for experienced real estate agent’s services in Berstoun. We help find the best real estate offers in the market to fit almost every budget and requirement.

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