What is an NOC and why is it required?

A No-Objection Certificate (NOC) is a formal document issued by the property developer confirming that all outstanding service charges and fees have been paid. It is a mandatory requirement to legally transfer the property to a new owner.

Who usually pays the 4% DLD transfer fee?

The 4% Dubai Land Department (DLD) transfer fee is customarily paid by the buyer. However, in some cases, the buyer and seller may negotiate to split this cost.

How much are real estate agent commission fees in Dubai?

Real estate agency fees in Dubai are typically 2% of the property's final selling price, plus a 5% VAT on the commission amount. This should be agreed upon when signing the listing agreement (Form A).

Understanding the Costs Involved in Selling in Dubai

What are the primary fees when selling a property

When you decide to sell your property, several non-negotiable fees come into play. These are required to ensure the legal and administrative transfer of ownership from you to the buyer.

The main costs include:

Developer Fees (NOC): To proceed with a sale, you must obtain a No-Objection Certificate (NOC) from the property's master developer. This document confirms that all service charges and other dues are cleared. The cost for an NOC can range from AED 500 to AED 5,000, varying by developer.
Real Estate Agency Fees: Engaging a reputable real estate agency is standard practice to market your property effectively and find qualified buyers. In Dubai, the agency commission is typically 2% of the final sale price, plus 5% VAT.
Dubai Land Department (DLD) Fees: While the buyer usually pays the 4% DLD transfer fee, sellers should be aware of this cost as it can sometimes be a point of negotiation. An admin fee of AED 580 is also added for issuing the new title deed.

How are ownership transfer fees handled

The official transfer of the property title is managed by a Registration Trustee appointed by the DLD. This process involves its own set of administrative fees that must be paid to complete the transaction.

These transfer fees are determined by the property's sale price:

For properties sold for less than AED 500,000, the fee is AED 2,100 (plus 5% VAT).
For properties sold for more than AED 500,000, the fee is AED 4,200 (plus 5% VAT).

Typically, the buyer covers this cost, but it can be split between the buyer and seller based on their mutual agreement in the sales contract (Form F).

Are there extra costs for selling a mortgaged property

Yes, selling a property that still has an outstanding mortgage involves additional steps and fees to clear the existing loan before the title can be transferred to the new owner. These costs are the seller's responsibility.

What are the key mortgage-related charges

Early Settlement Fee: If you are paying off your mortgage ahead of schedule, your bank will charge an early settlement fee. Under UAE law, this fee is capped at 1% of the remaining loan balance or AED 10,000, whichever amount is lower.
Mortgage Release Fee: Banks charge an administrative fee to formally release the mortgage and provide the necessary clearance letters for the DLD. This fee typically ranges between AED 1,500 and AED 1,875.
Blocking Fees: When selling a mortgaged property, a blocking fee of AED 1,545 is applicable at the DLD to place a temporary hold on the property during the transaction. The buyer and seller decide who pays this as part of their agreement.

Why you need a conveyancer

Given the complexity of property transactions in Dubai, hiring a conveyancer or sales progression professional is highly recommended. A conveyancer oversees the entire legal and administrative process, ensuring all documents are correctly prepared, reviewed, and submitted.

What services does a conveyancer provide

Drafting and reviewing the terms of the sale agreement (Form F).
Verifying title deeds and ownership documents.
Coordinating with developers, banks, and the DLD.
Facilitating the secure transfer of funds and contracts.

Conveyancing fees in Dubai for a residential property typically range from AED 5,000 to AED 15,000. While an added expense, their expertise provides peace of mind and helps prevent costly errors or delays in the transaction.

What about selling an off-plan property

If you intend to sell an off-plan property before its completion, you must first consult the developer. Many developers have specific conditions and restrictions on resales, often called "flipping."

It is common for developers to require that a certain percentage of the property's payment plan has been paid off before they will issue an NOC for the sale. Be sure to clarify any potential resale fees or conditions directly with your developer before listing your off-plan unit.

Final Thought

Understanding the costs of selling your Dubai property is the first step toward a successful and transparent sale. By factoring in developer fees, agency commissions, DLD charges, and any potential mortgage-related expenses, you can accurately calculate your net profit and navigate the sales process with confidence. Working with experienced professionals like real estate agents and conveyancers will ensure that every step is handled correctly and efficiently.