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6 Hidden Costs of Renting a Home in DubaiMay 7, 2020
To rent a home in Dubai is not a very complicated process, but, as we have previously covered in our rental guide, there is a bit more involved than simply signing the contract and moving in. There are a few other costs when renting a home in Dubai that could put a dent in your budget if you don’t keep them in mind. Here are the ones to be aware of. Should you have any further questions, our rental team would be happy to answer them and put you at ease.
If you are renting through a real estate agency or brokerage, then you will have to pay them a commission. This is typically 5% of the total rent for the year, or of the total contract value in the case of a multi-year contract. It is a fixed cost that you only pay once and should be mutually agreed upon prior to proceeding with the transaction.
Ejari Registration Fee
Your rental becomes official in the eyes of the government once you register it on the Ejari system. This creates an electronic record of the rental details that can be used to resolve any legal disputes down the line and is designed to protect the interests of both landlords and tenants. The registration fee is AED 195, regardless of the size or type of property.
Certainly not a feature unique to Dubai, the security deposit is a sum that must be paid at the start of your contract. It is typically equal to 5% of the annual rent for unfurnished properties and 10% for furnished properties. The deposit is refunded when you exit the contract, though part of the refund could be deducted based on the condition of the property when you leave it, especially if there is any damage that needs repairing.
DEWA, or Dubai Electricity & Water Authority, is the main utility fee that you will be paying, unless it is specifically stated that utilities are covered by the landlord. The payment is divided into a non-refundable DEWA connection fee of AED 110 (standard for all properties) and a refundable deposit - AED 2,000 for apartments and AED 4,000 for villas.
District Cooling Deposit
It’s difficult living in Dubai without an air conditioner, but you also want to keep air conditioning bills to a minimum. Fortunately, there is an option for that - district cooling. District cooling is a centralised cooling system for buildings that helps to cut down on power consumption for air conditioners, making each home more energy efficient. The fees associated with district cooling vary based on usage, as well as the size of the property (which would affect how much power is consumed in cooling it). If you want to avoid that, then you should consider searching for a rental that is ‘chiller free’, meaning that the cost of air conditioning is paid for by the landlord, which makes it a more cost-effective option for you.
Every property in Dubai is subject to a housing fee, also known as the Dubai Municipality fee. The housing fee is 5% or the yearly rental amount, divided into 12 monthly payments and added to your DEWA bill. As a tenant, you would be responsible for paying this along with your utility payments, unless utilities are covered in your rental contract. Simply put, whoever’s name is on the DEWA bill pays the housing fee.