What are the hidden cost for buying a property in Dubai?
Buying a property in Dubai is an exciting and significant investment. However, it’s important to be aware of the hidden costs that can arise during the buying process. In this blog, we will discuss some of the hidden costs of buying a property in Dubai to help you plan and budget accordingly.
- Property Registration Fee
When you purchase a property in Dubai, you will need to register it with the Dubai Land Department. This process incurs a fee of 4% of the property value, which can be a significant amount depending on the value of the property.
- Real Estate Agent Commission
If you choose to work with a real estate agent to find your property, you will need to pay a commission fee. Typically, this fee is 2% to 3% of the property value, which can add up to a significant amount.
- Mortgage Processing Fee
If you’re taking out a mortgage to finance your property purchase, you will need to pay a mortgage processing fee. This fee can vary depending on the bank and the loan amount, but it’s typically 1% to 2% of the loan value.
- Valuation Fee
Before approving your mortgage, the bank will require a property valuation to determine its market value. You will need to pay a valuation fee, which can range from AED 2,500 to AED 5,000, depending on the size and location of the property.
- Maintenance Fees
Many properties in Dubai come with maintenance fees, which cover the cost of upkeep for communal areas, such as gardens and swimming pools. These fees can vary depending on the property and its amenities, but they typically range from AED 10,000 to AED 15,000 per year.
- DEWA Security Deposit
When you purchase a property in Dubai, you will need to pay a security deposit to the Dubai Electricity and Water Authority (DEWA). This deposit can range from AED 1,000 to AED 5,000, depending on the size of the property.
- Property Insurance
Property insurance is a necessary expense when buying a property in Dubai. It covers you in case of damage or loss of the property due to unforeseen events, such as natural disasters or theft. The cost of property insurance can vary depending on the value of the property, but it’s typically 0.5% to 1% of the property value per year.
In conclusion, buying a property in Dubai involves more than just the purchase price. It’s essential to be aware of the hidden costs involved in the buying process to plan and budget accordingly. These hidden costs can add up, but with proper planning and budgeting, you can ensure that you’re prepared for all the expenses involved in buying a property in Dubai.
