The true cost of owning Dubai property extends well beyond the purchase price. Many investors focus on yield and capital appreciation while underestimating annual running costs, particularly service charges, which can eat 1.5–3 percentage points of gross yield. This guide itemises every annual cost of Dubai property ownership so you can model accurate net returns before you buy.
Complete Dubai property ownership cost breakdown
| Cost Item | Typical Range | Who Pays | Notes |
|---|---|---|---|
| Service charges | AED 8–30+ per sqft/yr | Owner | Varies dramatically by building |
| Property insurance | AED 800–3,000/yr | Owner | Contents + building for apartments |
| DEWA connection (vacant) | AED 2,000–5,000/yr | Owner (vacant periods) | Security deposit + min. usage |
| Property management fee | 5–10% of annual rent | Owner | If professional PM used |
| Maintenance / repairs | AED 2,000–10,000+/yr | Owner | Budget 0.5–1% of property value |
| Mortgage payments | Depends on loan | Owner | If financed |
| DTCM licence (STR) | AED 1,500–3,700/yr | Owner | If operating holiday home |
| Annual property tax | 0% | N/A | Does not exist in UAE |
A AED 1,500 per sqft apartment of 900 sqft (AED 1.35M purchase) with a service charge of AED 20 per sqft costs AED 18,000 per year in service charges alone, that is 1.33% of purchase price annually, before any other costs. On a 6% gross yield (AED 81,000 rent), service charges alone reduce net yield to under 4.7%. Always retrieve the actual RERA-registered service charge per sqft before any purchase decision.
Frequently Asked Questions, Dubai Property Costs
The RERA service charge index is publicly available and lists approved per-sqft rates by building. You can search by building name or community on the RERA portal. Agents and developers are legally required to disclose the service charge, if they cannot provide the RERA-registered figure, treat this as a red flag.
Yes, RERA reviews and approves service charge budgets annually for each building. Owners vote on the budget in the Annual General Meeting of owners (AGM). Service charges can increase if maintenance costs rise, the sinking fund is underfunded, or new facilities are added. RERA must approve any increase and disputes can be referred to RERA's owners associations department.
Service charges are always the owner's responsibility, not the tenant's. They are invoiced by the building management company directly to the owner. Failure to pay can result in RERA enforcement action including restrictions on future DLD transactions. Factor this into your yield model even when fully tenanted.
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