Buying a property is probably one of the most significant events of any individual’s life and, for many, the final long-term investment that comes along with a ‘dream come true.’ However, as far as the process of purchasing a property goes, especially in a place such as Abu Dhabi, there are some several fees included in the whole procedure that cannot be overlooked. These fees include, for instance, the registration fee, specific land use, and infrastructure usage fee. This shall be part of your investment, and it changes the amount sometimes. Knowing all these fees will hence prevent those shocks on the last amount. Some of the main fees in the process of acquiring a property in Abu Dhabi include:

1. Sale and Purchase Fee

Among the major fees that would arise for a buyer who might consider purchasing Abu Dhabi property, there is the registration fee commonly known as the sale and purchase fee. The executive committee has broadly agreed on a general resolution number 49 that puts the supposed make up of the registration fee in a range between 1-4% of the actual property value and at present is 2%. For charge, this in a standard case that tends to take place among selling and buying at Abu Dhabi must be apportioned taking in mind the circumstances of mutual consensus. Here 2. Musataha and Usufruct Fees: Usufruct or Musataha, is a right exercised and developing such land during their tenure for which they are given. Those properties which have an owner and whose owner registered have a rate as high as 4% total value for exercising or developing land, usufruct, or musataha. No cap is made on this and is calculated by taking 4% of the annual Musataha or usufruct consideration, based on current market values multiplied by the number of years within the agreement. It is to be paid at registration to the respective municipality upfront.

3. White Land Tax

It would charge the white land tax on the uncommitted commercial and investment lands owned by Abu Dhabi. These are between 1% and 4% of the total value of the land. They are those which would directly benefit from the infrastructural services. It has yet to be levied but would probably cause further developments on the land, reducing added demands for residential and commercial spaces.

4. Infrastructure Charge

This charge is paid by the buyer upon buying commercial or investment land. In the Emirate of Abu Dhabi, the charge is considered an ad-valorem, a single charge per square footage of land acquired and payable for basic services such as roads, utilities and public infrastructure, among others.

Infrastructure fee: this depends on locality in Abu Dhabi, it is AED 100 per square meter in central city, and AED 90 in Al Ain, Al Dhafra ranges AED 80. Also, this amount has to be taken into the budget as it’s going to hugely influence the figures at the sale price.

5. Disposal Fee of Handed Over Land Fee

If it has already been sold, donated, or auctioned to other people, then it will have borne the burden of 15% that the local municipality shouldered unto that lot if it’s not yet occupied. It is made effective by virtue of Resolution No. 49. And it doesn’t embrace mortgaging of the property; therefore the charge could be only upon disposal or the changing of its ownership.

This fee may also impact the following buyers or lenders in case the house is sold through foreclosure thus there is a need to know its implication.

6. Mortgage fees

One is bound to spend some additional money so that one may have a mortgage in Abu Dhabi. The mortgages’ laws of the UAE prescribe that one is required to register his mortgage, where one needs to pay 0.1% very low fee upon the registration of mortgage. This amount was on the complete purchase of property, and therefore, it needs to add on the top cost of a purchasing property.

7. Agent Fees

Usually, real estate agents in Abu Dhabi charge a commission. The commission is 2 percent of the total value of the property. In addition, the agent’s commission is charged with 5% value-added tax. This is another cost that is worthy of note, especially for those who hire the services of a real estate agent to facilitate the purchase.

8. Land Area Increase Fees

Sometimes, one may need more space after buying a specific residential or commercial property. The expansion of the land space of already existing residential or agricultural land reduces 5 percent of the value of the purchased space from its market value. For commercial or investment land, the charge provided is 75 percent of its market value. The charge is included any time you plan to expand the land space of the acquired property.

9. Other Charges

Other charges aside from the ones listed above, one pays when buying land in Abu Dhabi;

• Transfer fee for mortgage AED 200
• Mortgage redemption fee AED 1,000
• Commercial land consolidation fee AED 10,000
• Investment land consolidation fee AED 5,000
• Residential and Agricultural land consolidation fee AED 3,000
• Site plan fee AED 200
• Will of the property of a deceased AED 3,000
• Abu Dhabi Municipality Charge: About 2% of the selling price
• Mortgage Registration Fee: 0.1% of the selling price
• Commission for Real Estate Agency: 2% of the sale consideration + 5% VAT
• Commission for Bank mortgage arrangement: Mostly up to 1% loan amount + 5% VAT
• Cost for title deed: AED 1,000
• Bank’s property valuation charge: AED 2,500 to AED 3,000, + 5% VAT

10. To know the total cost

These are the charges you will be including in your budget when you are buying the property in Abu Dhabi, and you will financially be prepared for this. The fees might seem a little too much, but it will give you time to understand each one, and hence, you will be able to budget accordingly, not incurring any unexpected costs when buying the property.

Conclusion

This knowledge about the costs that accrue in purchasing property in Abu Dhabi will greatly benefit any buyer who would wish to venture into the real estate market. All of these fees-registration fees, appraisal fees, to agent commissions-prepare you for entering this market and committing money toward making a purchase. So the fees pile up, but knowing what is going to take place and budgeting ahead makes the process an easy and seamless one in securing the property purchase.