Question 1

How much commission does a broker charge for selling a property in Dubai?

Accepted Answer

Typical Dubai property sale commissions range from 2% to 5% for a residential property. The commission is calculated as a percentage of the selling price. However, the commission also depends on factors like property type, transaction complexity, and exclusivity agreements.

Property TypeCommission on Purchase TransactionResidential2% to 5% of selling priceCommercial5% to 10% of selling price

If more than one broker is involved in a transaction, the commission can be split between the brokers. The split is negotiable based on mutual understanding

Question 2

What commission do brokers earn for renting out properties in Dubai?

Accepted Answer

The standard rental commissions earned by Dubai brokers are 5% of annual rent for residential units and 10% for commercial assets, deducted from landlord proceeds.

Question 3

Do I need to use a broker to buy property in Dubai?

Accepted Answer

Using a regulated real estate brokerage in Dubai is highly advisable but not legally mandatory. Brokers have insider knowledge and facilitate key processes.

If you want to save money, you don’t need to hire a broker. Alternatively, the Dubai Land Department authorises trustee offices to transfer the property. They can also provide the necessary information about buying and selling property.

Question 4

What fees can I negotiate with my Dubai property broker?

Accepted Answer

While commission rates are relatively fixed, some aspects, like payment timelines, exclusivity periods, and marketing commitments, can be negotiated. You shouldn't negotiate the commission with the agent if you want the agent to find the best deals for you. Otherwise, he can offer the best deals to others, offering a better commission.

The buyer always pays the commission to the brokers. The owner is only concerned about the net price received. Even if the seller pays the commission, he always charges the buyer for the commission. For example, if the seller wants to sell his property for the net price of AED 10,000,000, and the commission is 5%, the final property price would be AED 10,500,000.

Question 5

How do I ensure I choose a reputable brokerage in Dubai?

Accepted Answer

Opt for brokerages registered with RERA that specialise in your property sector of interest and have 5+ years of operating history. Check online reviews.

Question 6

Can a broker represent the buyer and seller in the same property deal?

Accepted Answer

No, Dubai regulations prohibit dual representation to avoid conflicts of interest. Separate buyer and seller brokers must be appointed.

Question 7

What types of tax obligations are there for property owners?

Accepted Answer

In the United Arab Emirates, there are no property or income taxes. However, you must pay annual maintenance fees and service charges as a property owner. These payments go to the management company selected by the owners' association. You usually pay these fees one to four times a year, and they typically range from AED 10 to AED 30 per square foot. The exact cost depends on the specific project and the services included.

Question 8

What is a freehold property?

Accepted Answer

Freehold property refers to the type of property purchase where the buyer owns the plot and the unit. They are the landowners and have the title deed under his name.

An heir can inherit a freehold property from the title deed holder. The owner of a freehold property is entitled to lease, occupy, or sell the property. The owner can use the property for any purpose as long as it is per the local rules and regulations.

Freehold properties were introduced here to encourage foreign investment in Dubai. The most popular freehold areas for expats to purchase property include Dubai Marina, Emirates Hills, Al Barsha, and Palm Jumeirah.

Question 9

Can a broker help me buy a freehold property? And What is the difference between freehold and leasehold?

Accepted Answer

Yes, a broker can help you buy a freehold property. Brokers can assist in various stages of the property buying process, including finding the perfect property for the buyer, negotiating the purchase price, and ensuring a smooth closing process for both the buyer and the seller.

Freehold means complete property ownership by the buyer, who will have his name on the title deed. At the same time, leasehold refers to having the property on lease for more than ten years and up to 99 years. It cannot be bought completely.

Question 10

What is Oqood? And how can a broker help with Oqood?

Accepted Answer

Oqood refers to contracts in Arabic and is an online service by Emirates Real Estate Solutions for developers. It helps with the property registration process between the developers and buyers.

A broker can help with Oqood by assisting in the contract registration process, managing off-plan properties, and creating sales registration receipts.

Additionally, brokers can help buyers and developers navigate the Oqood system, ensuring complete transparency of the registration fee structure and protecting the rights of all stakeholders.

Question 11

What is an Off Plan? And can I hire a broker to help me find and buy an off-plan property?

Accepted Answer

An off-plan property is a property whose construction is yet to begin or is in its preliminary stages.

You can hire a broker to help you find and buy an off-plan property. Brokers can assist in the search for the best property options, provide insights into the real estate market, and navigate the entire transaction process, from searching for the best offers from developers to negotiating prices.

Question 12

What is DLD?

Accepted Answer

DLD is the abbreviation for Dubai Land Department. The government's regulatory body deals with all property- and real estate-related legislation, organisations, and services for any real estate transactions in Dubai.

Question 13

Can a broker help me get a DLD waiver? And What is a DLD waiver?

Accepted Answer

A broker can help you get a DLD (Dubai Land Department) waiver. Developers often offer waivers of DLD registration fees, and brokers can assist in identifying properties where this waiver is available and navigating the process of obtaining the waiver from the developer. A DLD Waiver is the waiver of the DLD fee levied on property purchases.

The DLD Fee is 4% of the property value and is payable by the buyer. Ergo, a DLD Waiver means the buyer does not pay this fee, and the developer pays it instead.

Question 14

Does a broker have to be licensed by RERA? And What is RERA Dubai?

Accepted Answer

Yes, a broker has to be licensed by RERA (Real Estate Regulatory Agency) to operate in Dubai. Brokers not licensed by RERA are subject to penalties, including fines and cancellation of their registration from RERA records.

RERA stands for Real Estate Regulatory Agency and is part of the DLD that takes care of the regulations in the real estate industry in Dubai. It handles the relationships between all parties of a contract and organises the exchange process of the properties.

Question 15

How long does a broker take to register a sale of real estate and receive the ownership Certificate?

Accepted Answer

After ensuring all necessary documents are prepared, registering a real estate sale and obtaining the ownership certificate typically takes 30 minutes.

Question 16

Can a broker help me get a power of attorney for buying property in Dubai?

Accepted Answer

Property buyers or owners can appoint someone as their legal representative using a power of attorney (POA). This representative can manage the property, including selling, mortgaging, or gifting it, as specified in the POA. The POA is typically valid for two years for these purposes. However, if it's used for buying a property, it remains valid for five years from the date it is officially notarised.

Question 17

Can I hire a broker to help me buy an off-plan property in Dubai?

Accepted Answer

Yes, you can hire a broker to help you buy an off-plan property in Dubai. Brokers can assist in the search for the best property options, provide insights into the real estate market, and navigate the entire transaction process, from searching for the best offers from developers to negotiating prices.

Question 18

Can a broker help you get a UAE investor visa?

Accepted Answer

A broker can assist in obtaining a UAE investor visa. Individuals who invest in property worth AED 1 million or more become eligible for this visa. Most brokers can offer advice on the process of acquiring an investor visa.

Question 19

How can a broker help me with taxes on a property purchase?

Accepted Answer

The United Arab Emirates is a tax-less country, so no taxes on property or any income are generated.

Question 20

What financial obligations do property owners have for maintenance fees and service charges, and how frequently are these payments due?

Accepted Answer

The property owner is responsible for the annual maintenance fee and service charge payments, which must be made to the management company hired by the owner’s association.

Payments are made between one and four times yearly at an average price of AED10- AED30 per sq. ft, depending on the project and services included.

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