Cost of Real Estate in Dubai

Cost of Real Estate in Dubai

The breathtaking skyscrapers of Dubai or splendid villas on its artificial islands might give you the impression that only millionaires can buy real estate here. However, this is not the case. As in any other city in the world, property prices in Dubai vary significantly depending on the area and type of housing. That is why you can find a flat or house to suit any budget. The key here is to remember the additional expenses that you will have to pay and to plan your purchase in advance.

How Much Do Flats Cost in Dubai?

Flats account for the biggest proportion of real estate in Dubai in terms of supply. At the same time, there is a significant disparity of prices. You can buy a budget studio flat of 30 to 40 square metres for prices starting at USD 60,000. Residential complexes with budget flats are located far from the city centre in neighbourhoods under development or in areas where there are no underground stations. You can find cheap flats, for example, in Dubai Production City, International City or Motor City. At the same time, even cheap properties in Dubai are duly finished and come with a built-in kitchen.

Expensive flats can cost USD 8,000,000 or even more. In this case, we are talking about luxurious penthouses with lots of bedrooms and bathrooms. You can find such homes in skyscrapers in Downtown and Business Bay. However, you will also find cheaper options in the same areas, as well as in Jumeirah Lake Towers, Jumeirah Village Circle, and Dubai Marina. Expats often buy flats with one bedroom. Such properties cost on average USD 200,000 to USD 300,000.

Photo: standret (Freepik)

How Much Do Villas Cost in Dubai?

Most villa projects are located in the suburbs and in new premium areas of the metropolis, including Emirates Hills, Arabian Ranches, Damac Hills, Mohammed Bin Rashid City and Mirdif. As private houses are designed with at least three to five bedrooms, the prices of even the cheapest houses start at USD 800,000. However, these complexes will come with security and minimal infrastructure, for example, a common pool and barbecue zone.

Villas in Dubai cost on average USD 2,000,000 to USD 5,000,000. These are usually two-floor or three-floor houses ranging in area from 400 to 1,500 square metres. The more expensive the villa, the more exciting the interior. More expensive properties come with terraces, private pools, private gardens and a garage for two or three cars. The cost of a house also depends on the infrastructure on the grounds of the complex, for example, whether it has a fitness centre and supermarket, and on the landscape design of the villa community.

The most expensive villas in Dubai can be found in Palm Jumeirah. In autumn 2022, a mansion was sold there for USD 163,000,000. However, such real estate is rare, resembling a collectible item designed for billionaires.

How Much Do Townhouses Cost?

Townhouses in Dubai tend to be built as part of residential complexes with villas or flats. In other words, the site development includes different property formats. You will find such projects in Dubai Hills Estate, Damac Hills, Dubai Land, Jumeirah, Arabian Ranches, Mirdif and other areas. Townhouses usually have two floors and sometimes three floors. The floor area of the houses varies from 250 to 450 square metres. Such properties are designed with balconies or terraces, with three to five bedrooms, utility rooms, small gardens and a garage for one or two cars. The houses are fully finished, come with built-in closets and walk-in showers. The grounds of such complexes include security, fitness centres, children’s grounds and sports grounds, barbecue areas and communal pools available to residents.

The cost of the townhouses starts at USD 500,000. The average price of such real estate varies from USD 800,000 to USD 1,000,000. Meanwhile, in some areas of the city, for example, in the Jumeirah area, the cost of townhouses can reach USD 4,500,000. The most expensive townhouses are usually located on the waterfront.

Dubailand, Housearch

Property Expenses in Dubai

When establishing a budget for the purchase of a property, you should factor in related expenses. There are several components. For example, if you require the services of a real estate agent, you will have to pay a commission of 2% of the property price. There are also mandatory payments, such as the Dubai Land Department (DLD) fee which equals 4% of the property price, and an administration fee of AED 580 (USD 158). The property registration fee for real estate priced at less than AED 500,000 (USD 136,140) is set at AED 2,000 (USD 545), plus 5% VAT; in the case of properties priced above AED 500,000, the fee is set at AED 4,000 (USD 1,089),  5% VAT. The fee for the issue of a certificate of title is AED 250 (USD 68).

If you plan to take out a mortgage in the UAE, be ready to pay a commission for the processing of the mortgage, equivalent to 1% of the mortgage. The local bank will also demand a professional valuation of the property. The cost of this service ranges from AED 2,500 AED (USD 680) to AED 3,500 (USD 953), plus 5% VAT. Mortgage brokers charge a commission of 1% to 2% of the value of the mortgage transaction.

When buying a property in Dubai, you also need to consider the Dubai Electricity & Water Authority (DEWA) fees. This organisation is responsible for the electricity and water connection of all houses in Dubai. The final bill depends on the location and type of the property. New DEWA connection costs from AED 2,300 (USD 626) for a flat to AED 4,000 (USD 1,089) for a villa or townhouse, depending on the number of meters to be installed.

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In a Nutshell

While there are different reasons why foreigners move to Dubai, all expats can afford permanent housing in the emirate in line with their budget. The city has both areas with low-cost flats and with some of the most expensive villas in the world. However, we have one general tip for expats with various financial options: when planning your budget, do not forget to calculate all the related expenses and add them to the cost of the flat or house. This way you will gain a real estimate of potential total expenses.

Cover photo: Frepik

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