Relocating to a new country is exciting, especially when you’re planning to put down roots and purchase a home. For many expats, the deposit is the most obvious upfront cost when buying property. However, it’s far from the only expense you’ll need to prepare for.
If you’re exploring a mortgage for expats in Dubai, understanding the full range of initial costs can help you avoid financial surprises and plan your move with confidence. Beyond the deposit, there are several mandatory fees, administrative charges, and practical expenses that can significantly impact your total budget.
Let’s break down what expats should realistically expect.
A Clear Overview of Additional Upfront Property Costs for Expats
Buying property as an expat involves more than simply paying a deposit and signing paperwork. There are several regulatory fees, administrative expenses, and practical setup costs that come into play before you receive the keys. Understanding these expenses in advance allows you to structure your finances properly, avoid last-minute cash flow issues, and ensure a smoother transaction process from offer to handover. Below are the key upfront costs expats should prepare for beyond the deposit.
1. Property Registration Fees
One of the largest upfront costs after your deposit is the property registration fee. In Dubai, this is typically 4% of the property value, paid to the Dubai Land Department (DLD).
For example, if you’re buying a property worth AED 1,000,000, you should expect to pay AED 40,000 just in registration fees. This amount is usually due at the time of transfer and cannot be rolled into your mortgage.
In addition, there may be small administrative charges related to the transaction process.
2. Real Estate Agency Commission
If you’re purchasing through a real estate agent, you will usually pay a commission fee. In Dubai, this is commonly around 2% of the property purchase price plus VAT.
While this may seem modest compared to the deposit, it can add up quickly. On a AED 1,000,000 property, a 2% commission means another AED 20,000 to factor into your upfront budget.
3. Mortgage Arrangement Fees
When financing your property, banks typically charge a mortgage arrangement fee. This is often around 0.5% to 1% of the loan amount.
For example, if your loan is AED 800,000, a 1% arrangement fee would mean AED 8,000 upfront. Some banks may allow you to add this to your loan, but many require payment at the start of the process.
There may also be valuation fees (to assess the property’s market value), which can range between AED 2,500 and AED 3,500 depending on the lender.
4. Conveyancing and Trustee Fees
Property transactions in Dubai must go through an official trustee office. Trustee fees typically range between AED 2,000 and AED 4,000, depending on the property value.
If you hire a conveyancer or legal advisor to manage the paperwork and ensure compliance, you should also budget professional fees. While not mandatory, legal assistance is highly recommended for expats unfamiliar with local regulations.
5. Developer Fees (For Off-Plan or New Properties)
If you’re buying directly from a developer, additional fees may apply. Some developers charge:
- Oqood registration fees (for off-plan properties)
- Service charge advance payments
- Administration fees
It’s important to clarify these charges before signing any agreement, as they can significantly increase your initial outlay.
6. Service Charges and Maintenance Fees
While technically ongoing costs, many developments require an advance payment of service charges upon handover. These fees cover maintenance of common areas, security, landscaping, and shared facilities.
Depending on the property type and location, service charges can vary widely. Apartments in premium communities may have higher annual fees compared to villas in suburban areas.
7. Utility Connection Fees
Setting up utilities is another often-overlooked upfront cost. You’ll need to pay connection deposits for:
- Electricity and water (DEWA in Dubai)
- District cooling (if applicable)
- Internet and telecom services
These deposits are refundable, but they still require cash upfront when moving in.
8. Home Insurance
Most banks require property insurance as a condition of approving your mortgage. If you’re taking a mortgage loan in UAE, the lender may also require life insurance coverage tied to the loan amount.
While insurance premiums vary based on the property value and coverage level, you should expect to pay the first year’s premium upfront.
9. Moving and Furnishing Costs
Beyond official fees, there are practical lifestyle expenses to consider:
- International or local moving services
- Furniture and appliances
- Interior modifications or minor renovations
Even if you’re buying a ready-to-move-in unit, furnishing a home can represent a significant initial investment.
10. Emergency Buffer
Finally, it’s wise to set aside an emergency buffer. Unexpected repairs, bank processing delays, or small overlooked administrative charges can arise during the transaction.
Financial advisors often recommend keeping at least 3–6 months of living expenses in reserve, separate from your property-related costs.
Conclusion: Plan Beyond the Deposit
For expats, the deposit is only the starting point. Registration fees, agency commissions, mortgage charges, insurance, utility deposits, and moving costs all add up quickly. In many cases, total upfront expenses beyond the deposit can reach 6%–8% (or more) of the property value.
By planning carefully and understanding every cost involved, you can approach your property purchase with clarity and confidence. A well-prepared budget ensures your home-buying journey is smooth, financially secure, and free from unpleasant surprises.
