Who pays the commission in a Dubai transaction — and who pays everything else

Nothing in a Dubai transaction causes more avoidable friction than the moment someone discovers a fee they assumed the other side was paying. Most of these items have a settled answer; several of them have an answer that is custom rather than law, which is exactly why they need to be written down before a deposit changes hands.

The agency fee: two different answers

• On resale, the buyer pays. The standard is 2% of the price plus VAT.
• On a new build, the developer pays. The broker's service is free to the buyer — not a favour from a particular agent, but how this market is built.
• Which means one specific thing to watch for. If someone asks you for a commission on a developer sale, over and above the developer's own price list, that is a question to ask rather than an invoice to pay.
• And one thing not to expect: going direct to a developer does not produce a discount, because the commission is inside the developer's economics either way.

The Land Department fee: rule and practice

The 4% transfer fee is calculated on the transaction value. Formally it is split between the parties; in practice the buyer pays it, and every budget in this market is built on that assumption. Developer promotions of the "we cover the DLD fee" kind exist and mean exactly what they say — which makes them one of the few genuinely comparable incentives on offer, because the number is fixed and knowable rather than a discount off an unpublished list price. On top of the 4% sits a fixed administrative charge, plus the trustee office fee, which scales with the transaction: of the order of two thousand dirhams on cheaper properties and four thousand on expensive ones, plus VAT.

The no-objection certificate, the one with no list price

• What it is: the developer's confirmation that there are no service-charge arrears or other impediments to the transfer. Registration does not proceed without it.
• What it costs: whatever the developer sets, and the range is wide — from a few hundred dirhams to several thousand.
• Who pays: a matter for the parties. Market practice puts it on the seller, and market practice is not a contract.
• So settle it in the offer, not on transfer day, when one side has already moved out and neither wants to be the one who blinks over a four-figure fee.

Off-plan changes the timing, not the percentage

• The same 4% is paid at the start, on registration of the preliminary contract in the Oqood system, rather than at handover. The main cost therefore falls when there is no property yet.
• No agency commission on a developer sale, as above.
• The developer's administrative registration fee appears instead, and it does not exist on resale.
• An assignment adds its own fee for permission — a fixed amount at many developers, around $1 400 at the common end, though some charge a percentage instead. Worth establishing before you buy if exiting before handover is the plan, and not after.
• On the assignment itself, the 4% is paid again by the new buyer, on the new price. That is a feature of the mechanism rather than a surprise, but it belongs in the numbers when you model the exit.

The smaller lines that still show up

• Title issuance and the fixed administrative charges around registration.
• A power of attorney where you are not attending in person — roughly $550 for a remote transaction, and more if consular legalisation abroad is involved.
• VAT on services, which attaches to commission and to the trustee fee rather than to residential property itself.
• A mortgage adds roughly a further one and a half per cent in charge registration, arrangement fee and valuation, none of it financed by the loan.
• The rule of thumb for a cash purchase: budget 7–8% above the price. That is the number to underwrite, not the 4%.

Settle it before the deposit, in writing

Three items on this list are custom rather than statute — who pays the DLD fee, who pays the NOC, and who pays the agency on a resale where both sides have a broker. Custom is a good default and a poor argument, and every one of these disputes happens at the worst possible moment: after a deposit has been placed and before a transfer that both parties now want to complete. A single line in the memorandum of understanding naming who pays what resolves all three in advance, and costs nothing at the stage where everyone is still being agreeable.

Based on Land Department fees, trustee office charges and standard Dubai agency practice.