Purchasing property in Abu Dhabi is an exciting investment and a major financial commitment. Along with the purchase price, buyers must account for several additional fees, including Abu Dhabi property registration fees, transfer costs, agent commissions, and infrastructure charges. These costs impact the overall budget, so being informed upfront is essential. This guide offers a detailed breakdown of every fee to help buyers avoid unexpected expenses and plan their finances effectively.
Important Abu Dhabi Property Registration
Comparison with Dubai Property Fees
Important Abu Dhabi Property Registration Fees
1. Sale and Purchase Fees
The sale and purchase fee is one of the most important costs involved in property transactions. Under Resolution No. 49, this fee ranges between 1% and 4% of the property value, with 2% being the standard rate. It is usually split equally between the buyer and seller unless the parties agree otherwise.
Example:
For a property valued at AED 1.5 million, the total sale and purchase fee would be AED 30,000. If divided equally, the buyer and seller will each pay AED 15,000.
Being aware of these charges upfront will help buyers plan their payments and avoid delays during the transaction.
2. Property Registration Fee Abu Dhabi
The property registration fee in Abu Dhabi is a necessary step to transfer ownership legally. Buyers must pay 2% of the property’s value to the Abu Dhabi Municipality for registration. This fee ensures that the property title is officially recorded in the new owner’s name.
In some cases, the fee can vary from 1% to 4%, depending on the property type and location. Both residential and municipality fees for commercial properties in Abu Dhabi follow the same structure, making it essential for buyers to include these costs in their budget.
3. Musataha and Usufruct Fees
Properties purchased under Musataha or usufruct agreements require a 4% registration fee based on the value of the lease. These agreements grant property rights for a specified period (typically 10 to 50 years) without transferring full ownership.
This fee must be paid in full at the time of registration with the municipality. Buyers should also note that these types of agreements do not have a fee cap, making them more expensive for high-value leases.
4. Abu Dhabi Property Transfer Fee
The property transfer fee in Abu Dhabi is another significant expense. It is calculated at 2% of the property’s value and is paid at the time of ownership transfer. This fee secures the legal transfer of ownership and issuance of the title deed.
If you’re working with a seller, it’s common practice for the transfer fee to be split equally, but it’s always good to confirm this arrangement during negotiations.
5. Infrastructure Fees
Infrastructure fees are mandatory for commercial or investment properties. These fees support the development of essential services like roads and utilities. The amount varies depending on the location of the property:
- AED 100 per square meter for properties in Abu Dhabi
- AED 90 per square meter in Al Ain
- AED 80 per square meter in Al Dhafra
Since infrastructure costs can add up quickly for larger properties, buyers should consider them when planning their finances.
6. Agent Commission Fees
Working with a real estate agent simplifies the buying process but comes at a cost. In Abu Dhabi, agents charge 2% of the property’s value as commission, with an additional 5% VAT. Negotiating the commission before finalizing the agreement will help prevent misunderstandings.
7. Mortgage Registration and Related Fees
If buyers secure a loan to purchase property, they will need to pay a mortgage registration fee of 0.1% of the loan amount. Banks also charge a mortgage arrangement fee, usually it is 1% of the total loan, plus 5% VAT.
Additional mortgage-related fees include:
- Mortgage Transfer Fee: AED 200
- Replacement of Mortgage Fee: AED 1,000
These fees are essential to factor into the overall budget when financing the property through a loan.
8. Other Service Fees for Buying Property in Abu Dhabi
In addition to the primary fees, buyers must also account for several miscellaneous expenses. Here is a quick overview:
- Title Deed Issuance Fee: AED 1,000
- Site Plan Issuance Fee: AED 200
- Will Registration for Property Transfer: AED 3,000
- Bank Property Valuation Fee: AED 2,500 – AED 3,000 + 5% VAT
- Commercial Land Consolidation Fee: AED 10,000
- Investment Land Consolidation Fee: AED 5,000
- Residential Land Consolidation Fee: AED 3,000
Planning for these additional fees makes sure that there are no disruptions in the purchasing process.
Abu Dhabi Comparison with Dubai Property Fees
Although property fees in Dubai are similar to those in Abu Dhabi, there are a few key differences. Dubai charges a 4% transfer fee, which is higher than Abu Dhabi’s 2%. However, other fees, such as mortgage registration and agent commissions, follow similar structures in both emirates.
FAQs about Property Fees in Abu Dhabi
1. What is the service charge for property in Abu Dhabi?
Service charges in Abu Dhabi cover maintenance, utilities, and shared amenities. These fees vary based on the property type and are calculated per square meter.
2. What is the property tax in Abu Dhabi?
Currently, there is no property tax in Abu Dhabi. However, the White Land Tax will impose 1% to 4% annually on vacant commercial and investment land to encourage development.
3. What is the housing fee in Abu Dhabi?
Unlike Dubai, Abu Dhabi does not impose a specific housing fee on residents. However, property owners are responsible for regular service charges based on the community facilities.
Conclusion
Understanding the fees involved in buying property in Abu Dhabi helps buyers avoid surprises and plan their budgets effectively. From sale and purchase fees to registration costs, infrastructure charges, and agent commissions, every step involves financial commitments that buyers must consider early on.
Planning will make the purchasing process smoother and help you focus on finding the right property. If you’re also exploring the Dubai market, Time Homes Real Estate is here to guide you through every step, making your real estate journey easy and quick.
This guide provides all the essential details about Abu Dhabi property registration fees, transfer costs, and related expenses. By being aware of these fees, buyers can make informed decisions, secure their investments, and avoid transaction delays. You can explore Time Homes Real Estate’s blogs to keep an eye on such important details.
