Property maintenance costs in Dubai
Property maintenance costs in Dubai
Real estate in the UAE is popular among foreigners both for investment and for moving to a permanent place of residence. And one of the most popular destinations is Dubai. It attracts not only tourists, but also those for whom moving to the city seems like a good prospect for many different reasons. Among the main advantages are a developed economy, medicine and excellent business opportunities. It is quite possible to buy a home in the UAE profitably, but before buying, you should find out how much it will cost to maintain it and whether property owners in Dubai have to pay tax? In fact, everything is not so expensive, since the country lacks most of the mandatory payments and property taxes typical of other states.
The United Arab Emirates can be considered an ideal place to invest in real estate. The legislation here is quite loyal - there are no many tax fees and the homeowner only needs to pay registration fees. These duties are most often included in utility bills, so there is no need for foreign investors to submit reports: the process is carried out automatically. If you are wondering how much it will cost to maintain a property in Dubai, then read our article. In it, qualified specialists from UAE Assets will tell you in detail about the mandatory costs that a homeowner in the UAE has to pay.
Taxes on the purchase of real estate in the UAE
As mentioned earlier, the UAE is a country with a fairly loyal taxation. There is no annual tax on real estate, rent, sale, maintenance and inheritance of housing. There is also no need to pay income and corporate taxes. The advantage is that these benefits apply regardless of whether the property owner is a resident or non-resident, individual or legal entity.
When buying property in Dubai, buyers are subject to the following mandatory taxes and fees:
- Property transfer tax (Transfer fee) is paid for the registration of the dwelling in the register. Its size depends on the emirate - in Dubai it is 4% of the amount specified in the contract. Usually the seller and the buyer pay it equally. When paying this tax, you also need to pay an administrative fee of 540 dirhams (≈$150);
- Registration fees - a fixed one-time payment, the amount of which depends on the price of the property:
– 2,000 dirhams (≈$550) for properties below 500,000 dirhams (≈$137,000)
– 4,000 dirhams (≈$1,100) for objects priced above 500,000 dirhams (≈$137,000)
- Fee for the issuance of a certificate of ownership - after the transaction, the future owner must take a certificate of ownership, confirming the legality of ownership of the object. To get it, you need to file an application with the local court and pay a fee of 250 dirhams (≈$70). The certificate will be made within 3 days.
This list can also include the commission of the realtor hired to purchase the property. According to generally established practice, the average remuneration of an agent is 2% of the contract amount.
How much does it cost to maintain property in Dubai?
The maintenance of real estate in the UAE varies by emirate. For example, Dubai in this regard is the most expensive and costly city, as most of the foreign buyers and tourists come here. Instead of an annual housing tax, there is an annual maintenance fee. Funds are taken for the care of the adjacent area, maintenance of cleanliness, overhaul, playgrounds for children and a gym. The amount of the contribution is determined by the developer of the project. On average, the annual property maintenance fees in Dubai are $15-60 per square meter - the amount is paid a year in advance. Utility bills are calculated according to the area of the apartment and meter readings, this payment includes bills for water, electricity, garbage collection and air conditioning.
If you plan to rent out properties, then the cost of maintaining housing in Dubai will include additional expenses. Although there is no tax on income from rental properties, you will have to pay a municipal fee ranging from 2.5% to 10% of the rental amount. The rate depends on the type of housing and city, in Dubai it is 5% of the rental amount. The collection is automatically included in the utility bills, so it is paid with utilities. For commercial real estate, the rate is 10%.
UAE Assets has been working with the UAE housing market for several years. We have competent specialists who are ready to advise you on the purchase and rental of housing, as well as on the costs of maintaining residential real estate in Dubai. If you have any questions or would like to book a consultation with UAE Assets, please fill out the feedback form. We will call you back as soon as possible and provide you with the information you need.