What Is the Service Fees While Buying a Property in Abu Dhabi

Buying a property is a huge milestone. However, one must keep in mind all the costs involved. When buying a property in Abu Dhabi, an investor or buyer must keep in mind certain service fees. 

Despite no taxes, you may come across several hidden costs of buying a property. For instance, registration fees or ownership transfer charges. For that reason, one must understand and adhere to all these costs. 

Let’s go through the different types of service fees while buying a property in Abu Dhabi and understand their meaning. 

• Types of Service Fees
• Sale and Purchase Fees
• Musataha and Usufruct Fees
• White Land Tax
• Infrastructure Fee
• Mortgage Fee
• Agent Fee
• Other Fees
• FAQs

Types of Service Fees

While following the guide to buying a property in Abu Dhabi, one can come across different methods and fees. As a buyer, consider the following key categories of service fees associated with buying a property in the capital:

• Sale and Purchase Fees
• Musataha and Usufruct Fees 
• Infrastructure Fee
• Other Fees

Here’s a detailed explanation of the important service fees while buying a property in Abu Dhabi.

Sale and Purchase Fees

Similar to the hidden costs of buying a property in Dubai, sales and purchase fees in the capital are among the most significant ones.  This fee ranges between 1% to 4% of the property value. That said, 2% each is paid by the buyers and sellers. 

For instance, if the property costs AED 1 million, both buyers and sellers will have to pay AED 20,000 each.

Musataha and Usufruct Fees

As highlighted in Resolution No. 49, buying Musataha or usufruct rights has a set fee of 4% of the value of those rights. As per the Musataha Agreement in Abu Dhabi, buyers will have to pay a flat fee of 4% of the accumulative annual rent for 10 to 50-year agreements. The same scenario will be applied to the usufruct properties in Abu Dhabi.

White Land Tax

While the white land tax isn’t applied yet, the land owners of commercial or industrial properties will have to pay 1% to 4% of the land value. This will be an annual tax on undeveloped commercial and investment properties. This tax, called the “white land tax,” will only apply to land with access to infrastructure.

Infrastructure Fee

Buying commercial or investment land in Abu Dhabi requires a one-time infrastructure fee. This fee goes to the local government based on the land size (square metres). Consider it a down payment to cover the cost of roads, utilities and other infrastructure needed for your property. People with house models and piles of coins are calculating and recording income and expenses for financial planning, financial planning ideas for home and real estate purchases.

In Abu Dhabi, the fee is AED 100 for every square metre of land. Meanwhile, the fee for the Al Ain and Al Dhafra regions in Abu Dhabi is AED 90 and AED 80 per square metre, respectively.

Mortgage Fee

If you’re getting a loan, a small fee of 0.1% is applicable to register the mortgage. This fee is essential as per the mortgage laws in the UAE. Buyers can expect this service fee while buying a property in Abu Dhabi. You can also check out the mortgage calculator and find the fee and mortgage amount on the Mortgage Finder.

Agent Fee

If you use a real estate agent, they will charge a commission of 2% of the property value. Plus, a 5% value-added tax (VAT) as well.

Other Fees

Other service fees while buying a property in Abu Dhabi include the following:

• Mortgage Transfer: AED 200
• Replacement of Mortgage: AED 1,000
• Commercial Land Consolidation: AED 10,000
• Investment Land Consolidation: AED 5,000
• Residential and Agricultural Land Consolidation: AED 3,000
• Site Plan: AED 200
• Will (For deceased person’s property): AED 3,000

FAQs

Keep reading the Property Finder blogs to learn more about fees and taxes related to real estate in the Emirates.

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