Buying Property in Dubai: Fees for Off-Plan Projects

Owning accommodation in Dubai is a compelling prospect for potential investors. The city’s housing market is rich and dynamic, so everyone will find a win-win solution. From a financial perspective, purchasing properties under construction is especially attractive. However, there are specific additional expenses when buying an off-plan estate in a vibrant metropolis.

Understanding all the fees related to projects under development is significant for proper budgeting and a stressless investment process. That’s when you should ask professionals for help, and Seven Lands Real Estate Agency is always here to support you. We will explain the obligatory and potential charges involved in the off-plan property-purchase process. 

Mandatory fees for buying property in Dubai 

First, let’s talk about the fees you must pay when acquiring a property under construction in the biggest city of the UAE. Among the most significant expenses are:

Oqood payment

This fee is specific to projects under construction and is paid to register the sales contract between you, the buyer, and the developer. The typical amount is 4% of the estate cost. Paying it protects your interests during construction until the project is finished and handed over to you.

Estate agent commissions

The standard rate is 2% of the property value. However, the amount may vary depending on the agreement between you and the agent. Generally, it covers property search, price negotiations, paperwork management, and transaction process assistance. This fee is mandatory as you can only buy a property with an agent. Also, with the help of a licensed broker, you get additional guarantees and support.

In addition, note that 5% VAT applies to some services and fees.

Developer fees when buying off-plan property

We want to pay special attention to the developer fees that apply when investing in an off-plan project. These costs can vary based on the estate’s specificity and the developer. Let’s mention the typical ones: 

No Objection Certificate charges

The NOC, issued by the developer, confirms that the property has no outstanding dues or legal issues. Usually, you pay AED 500-5K.

Utility connection fees

Ensuring that essential services are connected to the property and available upon the handover is crucial. Otherwise, you’ll have to pay DEWA fees (for electricity and water), which may be up to AED 4K for a villa + connection.

Services fees

These charges relate to the annual maintenance of the areas and facilities within a development. They include upkeep, repair, security, etc., and are usually calculated per square foot.

Modification charges

Apply if you request specific changes to the project’s design. The amount is negotiated individually with the developer.

Title deed issuance charges

You pay them when the project is done, and you need to obtain a property ownership document. The typical amount is AED 250.

Post-handover payments

Become actual if the developer offers an extended payment period after the handover.

Additionally, if you’d like to sell the property before the development process is over, you may be charged a 1–2% fee of the property cost for ownership transfer. Also, remember the 5% value-added tax.

Buying a property in Dubai: fee issues support

It’s crucial to have a detailed breakdown of all possible charges before finalizing the deal. But the matter of fees is extensive, and you can hardly cover all the details alone. Therefore, we recommend you contact Seven Lands for comprehensive advice to avoid financial risks. 

We know all the nuances and share transparent information about actual and potential fees so that you see every aspect before investing in the property. So, feel free to consult our specialists and buy the property of your dreams with less stress.