Cost of Buying Property in Dubai: A Complete 2025 Guide

Why Understanding Costs Matters

Why is it necessary to understand the cost of buying a property in Dubai? There are many reasons, including: 

• Hidden costs: The upfront cost of your property won’t be the only cost. There are many extra costs of buying a property in Dubai, including administrative fees, agent fees, and service and maintenance fees. You must take them into account while preparing your budget. 

• Budget: Your budget will be the most important part of your property transaction, as it will help you find the right property in Dubai. It’s especially crucial when you're also factoring in the cost of living in Dubai, which includes expenses like utilities, transportation, schooling, and healthcare.

• Stability: The cost of buying a property in Dubai should not outpace your finances, and calculating all the costs beforehand will help you ensure that your finances are suitable for the purchase.

One-Time Costs of Buying Property in Dubai 

Along with ongoing costs, there is also the one-time buying property in Dubai costs, which must only be paid once when you are going through the property transaction process. Understanding these costs will help you be better financially prepared when the time comes to buy a property. 

Dubai Land Department (DLD) Fees

Dubai has strict processes relating to property transfers. To register your property and validate the transaction, you must adhere to Dubai Land Department (DLD) regulations within 60 days.

As part of this process, you must pay the following Dubai Land Department Fees:

Down Payment

One of the biggest buying property in Dubai costs is the down payment. For most buyers, this deposit will range from 20% to 25% of the property’s value, depending on your residency status and whether the home is under AED 5 million.

To understand how down payments work—and what factors can affect the amount—you can read our full breakdown here: How much deposit is required for a mortgage in Dubai?

Whilst zero down payment properties may be advertised in Dubai, such offers are rarely as straightforward as they seem. In most cases, they come with trade-offs, including higher prices, increased financial risk, or ties to lesser-known developers.

Real Estate Agency Fee

There will be a real estate agent commission to cover the expertise and time spent by your agent, as well as a conveyancing fee.

Your real estate agent and conveyancer are responsible for ensuring that all legal requirements are met according to the laws of the United Arab Emirates. These fees may include a wide range of costs, such as administrative, legal, and other expenses necessary to ensure the entire process is carried out smoothly and efficiently.

Mortgage Costs

If you choose to buy using a mortgage, it's essential to keep in mind that there are additional fees that you may encounter.

• The Bank Mortgage Arrangement Fee usually amounts to 1% of the loan value plus an additional 5% VAT.

• The fee for property valuation varies and is typically between AED 2,500 to AED 3,500, plus an additional 5% VAT.

Insurance Costs

Although home insurance is not mandatory, it is highly recommended to avoid large unexpected costs in the event of an emergency.

When purchasing a property with a mortgage, you will usually be required to take out a life insurance policy. These costs can be as follows:

Security Deposit

When purchasing a property, the buyer must deposit 10% of the agreed transaction value in the seller's name. This deposit is a security measure typically held by the appointed real estate agent until the property transfer is finalized. It is important to note that the deposit is refundable if the transaction falls through due to unforeseen circumstances or breaches of contract.

However, if the buyer withdraws from the transaction without valid cause, they may forfeit their deposit. It is recommended to carefully read through the terms and conditions of the contract before depositing to ensure clarity and understanding.

Other important considerations

Apart from these direct costs, there are additional expenses to keep in mind:

• Service Charges: Service charges are annual charges for maintaining common areas in your community. These fees vary by community and should be factored into your budget.

• DEWA Fees: When considering the costs of purchasing a property in Dubai, it is essential to factor in the DEWA fee. This fee is charged by the governing body responsible for managing electricity and water connections in all households throughout Dubai. The cost of the DEWA fee varies depending on the type of property. The deposit for DEWA can range from AED 2,000 for an apartment to AED 4,000 for a villa, depending on the number of meters.

• Empower Fees: If your property is in a community that uses district cooling, you’ll also need to account for Empower fees. Empower provides energy-efficient cooling systems, and the charges typically include a deposit, consumption charges, and fixed monthly fees. These costs vary depending on the size of your property and your usage, so it’s important to understand the structure of these fees when budgeting for your home.

Tips for Managing Purchase Costs Smartly

Want to ensure that the costs of buying a property in Dubai do not hit your finances hard? Here are a few tips to help you manage them: 

• Savings: Ensure that you have set aside a certain amount of money in case additional costs arise for your property purchase. This will help you be better prepared and avoid any problems during the transaction.

• Mortgage: If you want to become a property owner but do not have the immediate finances, consider taking a mortgage to attain property ownership at a more gradual pace. There are many property mortgage options for buyers in Dubai. 

• Negotiation: This will be one of your biggest assets while purchasing a property. Do your research, understand market trends and the prices for the particular area to ensure you don’t end up paying a higher amount, and use an experienced real estate agent who will negotiate you the best price.

Summary Of Costs Of Buying Property in Dubai

Understanding the full cost of buying a property in Dubai is essential to plan your budget and avoid unexpected expenses during the purchase process.

Key costs to consider:

• Dubai Land Department (DLD) fees – 4% of the purchase price + AED 580 admin fee

• Registration fees – AED 2,000–4,000 + 5% VAT (based on property value)

• Down payment – Typically 20–25% of the property value

• Agency fee – 2% of the purchase price + 5% VAT

• Conveyancing fee – AED 6,000 to AED 10,000

• Mortgage arrangement fee – 1% of the loan amount + 5% VAT

• Property valuation fee – AED 2,500 to AED 3,500 + 5% VAT

• Home insurance – Around AED 1,000 annually

• Life insurance – 0.4–0.8% per annum on decreasing loan balance

• Security deposit – 10% of the agreed property price

• DEWA deposit – AED 2,000 (apartments) to AED 4,000 (villas)

Conclusion

When considering a property purchase in Dubai, it's essential to know the various costs that may arise beyond the purchase price. We’ve covered all the key costs you’ll need to plan for when buying a property in Dubai, from government fees to mortgage charges and everything in between. But there’s more to think about beyond the paperwork and numbers.

The cost of living in Dubai is another big factor. Things like groceries, school fees, transport, and utility bills can vary a lot depending on where you choose to live. At the end of the day, buying a home isn’t just a financial decision. It’s about finding a place that fits your lifestyle.

You can make a more informed and confident decision by carefully reviewing and factoring in these additional costs. With some research and preparation, as well as the expertise of an experienced real estate agent, you can navigate the buying process with ease and peace of mind.