The Hidden Costs of Buying Property in Abu Dhabi

1.  The Hidden Costs of  Buying Property in Abu Dhabi A comprehensive guide to understanding all fees and additional expenses beyond the listing price August 2025 Real Estate Investment Guide Made with Genspark

2. What Are the Hidden Costs?  Many buyers, especially first-timers, are surprised by the additional costs that emerge during the property transaction process. 6-10%  Mandatory government fees that can't be negotiated of property value  Banking and mortgage-related charges  Annual maintenance and service charges Additional costs beyond the listing price Understanding these costs allows you to budget effectively and avoid ?nancial surprises during your property purchase journey. Made with Genspark

3. 2025 Property Market Context   Market Insights 7% 5%  Strong demand and returning yield potential driving property value increases  Investment potential continues to grow in the region  Hidden costs can add 6-10% to the total property value Affordable Apartment Budget-Friendly Villa Price Increase Price Increase *Data as of mid-2025 Understanding both market trends and hidden costs is essential for making informed property investment decisions in Abu Dhabi. Made with Genspark

4. Main Property Fees Overview Property Registration Fee Mandatory fee charged by Abu Dhabi Municipality Major Upfront Costs In some cases, costs may be split between buyer and seller Off-plan developers sometimes cover this as an incentive Property Registration 2%  Of total property value NOC (No Objection Certi?cate) Mortgage Registration 0.1%  Required for secondary/resale property purchases Of total loan amount Con?rms seller has no outstanding payments NOC Certi?cate AED 3,500-5,500 Luxury developments typically charge higher fees  Varies by developer & location ⚠ These fees are mandatory and non-negotiable Understanding these major fees helps you plan your purchase with confidence and avoid unexpected costs. Made with Genspark

5. ADGM-Specific Fees  Registration Fee What is ADGM? Abu Dhabi Global Market (ADGM) is an international ?nancial center with its own real estate regulations and fee structure. 2% of property evaluation or value (whichever is higher) Mandatory for all ADGM property transactions  Mortgage Registration 0.1% of mortgage amount  No maximum cap applied ADGM Special Jurisdiction  Mortgage Discharge AED 1,000 per property (only if applicable) Understanding ADGM-speci?c fees is crucial when purchasing properties under this special jurisdiction. Made with Genspark

6. Additional Mandatory Costs   Property Valuation Fee Bank Processing Fee AED 2,500 - 3,500 0.5% - 1% of loan Fee Range: Fee Range:  Required for mortgage approval  Applied after mortgage approval ⚠ Non-refundable, even if mortgage application is rejected  May include arrangement or administrative fees  Must be paid upfront before loan disbursement   Title Deed Issuance Electronic Service Fees Standard Services: AED 1,000 + 5% VAT AED 1,000 Fixed Fee:  Issued by Department of Municipalities and Transport Mortgage Registration: AED 470 + 5% VAT  O?cial document that registers property in your name Mortgage Discharge: AED 65 + 5% VAT  Paid during the final stage of ownership transfer  *If applicable Be prepared for these additional costs when budgeting for your Abu Dhabi property purchase. Made with Genspark

7. Beyond Transaction: Utility & Moving Costs Post-Purchase Expenses ⚡   These costs are often overlooked but can significantly impact your initial budget Utility Deposits Internet/TV AED 1,000+ Setup Fees  Utility providers like ADDC require deposits before connection, typically AED 1,000 for water and electricity Water & electricity connection fees Varies by provider & package  Moving costs vary from AED 2,500 for apartments to AED 8,000 for large villas depending on belongings  New furnishings can cost between 5-10% of your property's   value if starting from scratch  Plan for these expenses in advance to avoid financial stress after completing your property purchase Moving Costs Furnishing AED 2,500-8,000 5-10% of value Based on property size For new furnishings These post-transaction costs can add up to a substantial amount and should be factored into your overall property investment budget. Made with Genspark

8. VAT Considerations for Off-Plan & Commercial Units  Off-Plan Properties VAT Basics 5% VAT on commercial off-plan purchases Standard VAT rate applicable to commercial 5% Residential off-plan typically exempt properties in Abu Dhabi  Commercial properties are subject to 5% VAT, collected by  Mixed-Use Properties developers and passed to the Federal Tax Authority VAT applies only to the commercial portion  Residential properties are generally exempt from VAT or zero- rated for ?rst supply within 3 years of completion Residential portion is exempt or zero-rated  Secondary Market Residential resales: exempt from VAT Commercial resales: still taxed at 5% Understanding VAT implications is crucial when budgeting for property acquisition, especially for investors in commercial or mixed-use developments. Made with Genspark

9. Annual Costs After Purchase Service Charges AED 10-25 per sq.ft. Maintenance Fees Varies by property type   Covers maintenance of communal areas, security, Charged annually; varies based on building quality, landscaping, and building facilities amenities, and location Home Insurance AED 1,000-5,000 per year Musataha & Usufruct Fees Up to 4% of property value   Mandatory for mortgage holders; covers ?ooding, ?re, theft, One-time fee for properties built on government land; and structural damage agreement period typically 10-50 years Annual and recurring costs can significantly impact long-term affordability. Budget for these expenses when calculating your total property investment. Made with Genspark

10. Tips for Managing Property Costs  % Budget 6-10% Extra Set aside additional funds beyond the property price to cover registration, mortgage setup, valuation, and legal costs.   Factor Annual Expenses Smart Planning Create a 5-year forecast for recurring costs like service charges, maintenance, and insurance premiums. saves money long-term  Compare Communities Research different neighborhoods for varying service charge rates and maintenance costs before buying. Plan ahead to avoid ?nancial surprises Work with local real estate experts who can recommend properties with lower fees, clarify ?nancial obligations, and provide access to exclusive incentives. Made with Genspark

11. Developer Incentives & How to Negotiate Negotiation Strategy Ask About These Incentives Work with a Local Expert  Waived Registration Fees Some developers cover the 2% registration fee as a sales Local real estate agents can help negotiate better terms and have incentive, saving you signi?cant upfront costs. access to exclusive developer relationships. % Covered VAT Developers may include the 5% VAT on off-plan properties to Timing Matters boost sales, especially for commercial units. End-of-quarter or year-end periods often see developers more willing  Exclusive Discounts to offer incentives to meet sales targets. Special pricing, free service charge periods, or complimentary title deed services may be available. Compare Multiple Offers Research comparable properties and use competitive offers as leverage in negotiations. Developer incentives can signi?cantly reduce your total investment costs. Always inquire about available offers and leverage professional assistance to negotiate the best possible deal. Made with Genspark

12. Conclusion & Key Takeaways Abu Dhabi Property Market Financial Planning  Safe and rewarding investment destination with strong 6-10% Budget extra for hidden costs beyond listing price regulations  Continued growth potential with 5-7% price increases in  Factor in both upfront fees and recurring annual expenses affordable segments  Research developer incentives to potentially reduce costs  Working with local experts ensures transparent transactions and better deals Make informed investment decisions by understanding all costs —  from initial fees to recurring charges. Contact Six S Real Estate Now! Made with Genspark