Dubai Land Dept to double transfer fees

EXCLUSIVE: Fees to rise to 4% in a bid to reduce flippers

Dubai Land Department is set to double the  transfer fees on property sales, Arabian Business has learned.

The fees will rise from 2 percent to 4 percent of the sale price for all properties, except the first direct sale from a developer to buyer, which will remain at 2 per cent. It is understood that an official announcement on the change could come as early as this weekend.

“[The] idea is to curb flipping. It’s a good move. Keeps end users and longer term investors in the game,”  a well regarded Dubai developer told Arabian Business, adding: “Gets rid of brokers who put down checks [sic] against properties hoping to find buyers quickly.”

By law, the property transfer fee is paid equally by both buyer and seller, but industry spokespeople said in practice, the buyer usually ended up paying the full amount.

The increase to 4 percent means the charge on a AED2m home would double from AED40,000 to AED80,000.

The amount must be paid in full, in cash and cannot be incorporated into a mortgage.

The change appears to be in a bid to reduce ‘flipping’ – the rapid on sale of off-plan properties – by making it less attractive for buyers to purchase from such speculators, but it also has the potential to affect end users.

A property sold by an end user – such as someone who has lived in the home for several years and wants to upgrade or leave Dubai – to another end user still would attract the higher transfer tax.

At least one real estate agent said it would likely encourage end users to remain in their property for longer.

With more than $6bn worth of property and land transferred in the year to July, according to Dubai Land Department figures, the increased fees  could also see government coffers significantly enhanced.

Join the Discussion

Disclaimer:The view expressed here by our readers are not necessarily shared by Arabian Business, its employees, sponsors or its advertisers.

NOTE: Comments posted on may be printed in the magazine Arabian Business

Please post responsibly. Commenter Rules

Posted by: imran

DAMAC is playing with its investors. They are forcing and charging 4% from first buyer.

Posted by: Disappointed

I had the same problem with DAMAC and finally paid 4% so if its for the first owner or second no difference you still have to pay the 4% and title deed is not yet come since a month and now dld demanding 5000dhs to process or i have to wait another 3 to 4 weeks more according to ADCB Representative handling the mortgage.

Posted by: bending over again!

Has anyone actually paid the new fee yet? Also if you signed an MoU stating you paid the 2% when dealing with a net seller are you liable by law then for the 4%, reason I ask is that if the law is indeed to stop flipping and the law insists the seller should pay 2% then why hasn't this been enforced to protect buyers and genuine investors? Does anyone actually know please?
One only hopes that EXPO 2020 panel hasn't seen this as an abuse of peoples rights and dignity and award the Expo to another country/ or may be they should...

Posted by: Andrew

Went to Emaar at 7.30am today (and yesterday, only to be told my bank had made a mistake on my NOC, and to come back tomorrow with an amended NOC). However, this morning a staff member announces to the people politely queing up at 8am that Emaar will not be accepting applications for land registrations today (the last day before the fees double). As you can imagine, the queue suddenly erupts into a surge of people to the desk with everyone shouting at the same time.

The staff state this is an Emaar management decision. Why upset so many customers who just want to finish the process and have a chance to beat the deadline? Now I have to come back for a third day next week, however I cannot afford the potential increased fee, so I am stuck.

The bigger issue is why is Dubai putting so many people through this huge stress and inconvenience, due to such a short deadline. I love living in Dubai, but these sudden rule changes are not good for residents and investors confidence.

Posted by: john frog

I am in the same boat. The registration dept of DLD answered my email this morning stating that the fee increase is in effect from today (not being extended) unless you have a token from land dept from Thursday. Just so happens that they stopped handing out tokens on Thursday morning (Shk Zayed rd DLD) as they were "full". Also happens that there was only one transfer/registration desk open !! I cant sit in a dept all day, I have work to attend or risk being sacked. The way we have been treated is a disgrace. The financial crisis that we have just battled through , to now get given 4 weeks to raise extra funds is disheartening. A total disrespect for peoples lively hood.

Posted by: cocco

To register a property you need an NOC from Developer.
So if you have one payment left on the property you need to pay this in full to get NOC. This could be 10/20/30% or so. Pay the final installment when the developer is not delivering the unit on time (3 years late), and is progressing like a snail!... in whose right mind is this registration fee implementation a fair and just approach to curtail the flippers ?

All comments are subject to approval before appearing

Further reading

Features & Analysis
Trading bricks: The growing popularity of real estate investment trusts in the Gulf

Trading bricks: The growing popularity of real estate investment trusts in the Gulf

Investor interest in real estate investment trusts (REITs) has...

Forgotten fees: the challenge of investing in Dubai property

Forgotten fees: the challenge of investing in Dubai property

Investors attracted to low service charges at some Dubai residential...

Dubai real estate: which way will it go?

Dubai real estate: which way will it go?

In this special report, Arabian Business analyses the state of...

Most Discussed