On paper, Dubai is the most open large housing market in the world and one of the least familiar in its mechanics. There is no annual property tax, no capital gains tax, no income tax on rent — and nothing resembling a European notarial conveyance. In its place: a state registrar with its own app, a developer registry, statutory escrow accounts, and trustee offices where title changes hands in twenty-five minutes.
What the buyer pays instead is concentrated at the entrance — a 4% Land Department registration fee, agency commission, developer charges: roughly 6–7% of the price. That is very nearly the entire fiscal burden for the whole holding period. After that, nothing, except service charges, which in Dubai can surprise you more than any tax.
And there is one layer that is underestimated more often than any other: succession. UAE real estate is governed by UAE law, not the law of the owner's nationality, and an apartment without a registered will is not something that simply "goes to the children" — it is a local court process with the title frozen. This is exactly where the ownership form chosen at purchase costs the most. For the general framework of cross-border deals, see the foreign real estate purchase hub; for country context, the UAE hub.
Who Can Buy and Where
The UAE is a federation, and the property regime is set by the emirate, not the country. Dubai operates under Law No. 7 of 2006 on land registration: a citizen of any country may hold freehold, usufruct, or leasehold up to 99 years, but only in areas designated by decision of the Ruler (Regulation No. 3 of 2006 and later additions). Outside those areas the buyer can only be a UAE or GCC national — and eligibility is checked against cadastral data, not the project name in the brochure.
Abu Dhabi took longer. Under Law No. 19 of 2005, a foreigner in the investment zones received only derivative rights: usufruct up to 99 years, musataha up to 50 years with renewal, long lease from 25 years, and "ownership of the unit without the land." The 2019 amendment — Law No. 13 of 2019 — opened full freehold in the investment zones, with the right to sell, mortgage, and bequeath. The zones are named officially: Yas, Saadiyat, Reem, Al Raha Beach, Masdar and others.
The distinction between the three terms is practical. Freehold is perpetual ownership of the unit and a share of the land. Usufruct is a right of use for a term; the asset itself remains someone else's — you can mortgage it, you cannot rebuild it. Musataha is a development right: you build on someone else's land and own the structure for the term. For a residential purchase there is only one sensible answer — freehold. The other emirates are more conservative: in Sharjah a foreigner gets not ownership but usufruct up to 100 years, in designated districts and with the Ruler's approval.
The Cost of Entry
Payment
Rate
DLD registration fee (Dubai)
4% of price (formally 2% seller + 2% buyer)
Registration fee (Abu Dhabi)
2% of price
Trustee office fee (Dubai)
AED 4,000 + VAT for prices from AED 500,000
Title deed issuance (Dubai)
AED 250
Agency commission
2% + 5% VAT
Developer NOC
AED 500–5,000
Mortgage registration (Dubai)
0.25% of the loan
Transfer into a structure as a gift (Dubai)
0.125%, minimum AED 2,000
Annual property tax
none
Municipality fee on rent
Dubai 5%, Abu Dhabi 3% of annual rental value
Tax on sale for an individual
none
The key point about the 4%: under DLD rules it splits evenly between seller and buyer, but the market works differently — the buyer almost always carries all four percent. That is custom, not law, and it is negotiable, particularly in a soft market.
Mortgages. The UAE Central Bank regulation sets LTV caps for expatriates: 80% on a first home below AED 5 million, 70% above, 60% on a second or investment property, and 50% on off-plan. There is no separate rule in the regulation for a non-resident without a UAE visa — banks decide for themselves, and practice is tighter than the regulation: the realistic ceiling for an overseas buyer is 50–65%, meaning a 35–40% down payment, plus each bank's own closed list of acceptable nationalities.
Off-Plan: Escrow, Oqood, and the Arithmetic of Termination
A large share of Dubai transactions are purchases under construction, and the legal framework here is sturdier than commonly assumed. Dubai Law No. 8 of 2007 requires the developer to open an escrow account for each project; buyers' money goes there and, under Article 9, is beyond the reach of the developer's creditors, while the escrow agent retains 5% of the balance for a further year after units are registered. Breaches are a criminal offence with fines from AED 100,000. The second element is Oqood, the DLD's interim register: registering there is not an agent's formality but the condition on which your right to an unbuilt unit exists.
What the law protects less well is your own exit from the deal. Article 11 of Law No. 19 of 2017 sets out the developer's rights when you default: above 60% project completion it may terminate and retain up to 40% of the unit's value, below 60% up to 25%, and where construction has not started for reasons outside its control, up to 30% of amounts paid. Build the off-plan payment schedule around your own worst case, not the marketing line about "only 20% at launch."
Ownership Form: Individual, Company, Foundation
The default for a residential purchase is the individual, and the reason is fiscal. Under Cabinet Decision No. 49 of 2023, an individual's real estate income falls outside corporate tax entirely where the activity does not require a licence, and it is not even counted toward the AED 1 million turnover threshold. On top of that, the Golden Visa attaches to property held personally, not in a company.
A company switches the tax on. A corporate owner pays 9% on profit above AED 375,000, and this is not limited to local structures: under Cabinet Decision No. 56 of 2023, a foreign company owning UAE real estate acquires a nexus in the country, must register, and pays tax on net income from the asset. A separate question is which corporate owners the DLD admits to freehold areas at all. The circle is narrow: historically JAFZA offshore companies, and since 2019, under a memorandum with the DLD, RAK ICC; several free zones require case-by-case approval. Ordinary foreign offshore companies are not registered by the DLD, so "buy it through a BVI" does not work here.
A separate class is DIFC and ADGM structures — SPVs and foundations under common law. They are used not for tax but for continuity: a foundation does not die, interests pass under its constitutional documents, and the asset stays out of the UAE succession process. The DLD processes a transfer into such a structure as a gift at 0.125% instead of 4% — provided the ownership configuration meets the department's requirements. On the vehicles themselves, see the analysis of the DIFC family office.
Holding: No Tax, But Costs
There is no annual property tax in the UAE, and no wealth tax. What exists instead is a municipality fee on rental value: in Dubai 5% of annual rent, charged in twelve instalments through the DEWA account; a tenant pays on the Ejari figure, an owner living in his own apartment on the RERA assessed rate. Abu Dhabi's equivalent 3% fee is paid by expatriate tenants, not by owners.
Rental income reaches an individual entirely untaxed: there is no personal income tax in the UAE, and corporate tax does not reach this income. VAT barely touches housing either — the first sale of a new build within three years of completion is zero-rated, subsequent residential transactions and bare land are exempt. The 5% begins where commercial property begins: both the sale and the lease of an office or retail unit are standard-rated.
The genuine recurring cost is service charges. Dubai Law No. 6 of 2019 on jointly owned property requires RERA to approve the tariff on the basis of an audited budget, and the money collected to sit in a separate account at an approved bank, beyond the reach of the management company's creditors. Approved rates are published in the DLD service charge index; check them before the deal — the gap between neighbouring towers can be several-fold, and non-payment gives the management company a lien over the unit.
Golden Visa: AED 2 Million and What Counts
The threshold is federal and singular: AED 2 million of property gives a renewable ten-year residence visa with the right to sponsor a spouse and children. A mortgaged property qualifies too: after the February 2026 changes the threshold is measured against the value recorded by the DLD on the title deed rather than the buyer's own money actually paid in, and the bank's letter confirms its no objection and the outstanding balance, not an amount paid. Off-plan also qualifies where the developer is RERA-registered and the deal is entered in Oqood: since 20 February 2026 the threshold is measured against the price recorded in Oqood rather than the amount actually paid — the earlier paid-up-half requirement was lifted by a Land Department circular that was never separately published, so confirm current practice at the date of filing. Several properties can be aggregated.
Below that threshold sits the two-year owner's visa: in spring 2026 the Dubai Land Department removed the minimum property value for sole owners, leaving AED 400,000 per person for co-owners; a completed property with a title deed is required. And the essential caveat — a visa is not tax residency. These are different tests with different criteria, see UAE tax residency.
Exit and Succession
There is no capital gains tax for an individual — not on a sale after a year, not after a month; nor are there minimum holding periods of the kind Singapore or Italy impose. A resale carries the same package of fees: 4% DLD (by market custom borne by the buyer), agency commission, developer NOC, mortgage discharge. There are no exchange controls, the dirham is pegged to the dollar — the bottleneck will be the receiving bank's compliance, not the UAE.
Succession is the one area where a mistake is genuinely expensive. Since 1 February 2023, Federal Decree-Law No. 41 of 2022 on Civil Personal Status has applied: for non-Muslims the default is no longer Sharia — the spouse takes half, the children share the other half equally, with no distinction by gender. But that is a default, not a solution. Heirs may ask for the law of the deceased's nationality to apply only where there is no registered will to the contrary, and the process runs through a UAE court while dealings with the asset are suspended.
Hence the practical standard: the will is registered alongside the transaction. For Dubai and Ras Al Khaimah there is the DIFC Wills Service Centre — an English-language common law will with no residency requirement; Abu Dhabi has the ADJD registry, and ADGM runs its own service. A home country will is not sufficient on its own: UAE real estate devolves under local law, and a foreign document has to be legalised, translated, and defended in court. A DIFC or ADGM structure solves the problem differently — the asset stops being the deceased's personal property. The wider logic sits in the succession planning hub.
Money and Compliance
The UAE left the FATF grey list in February 2024, and the regime since then has not loosened but settled. For a transaction this means three things. First, brokers, agents, and law firms report to the financial intelligence unit through goAML on any deal involving cash from AED 55,000, including chains of linked payments, and on any settlement in virtual assets. Second, a corporate buyer discloses its beneficiaries — the real beneficiary register is mandatory under Cabinet Decision No. 109 of 2023. Third, the bank tests the origin of funds separately from the registrar, and for a Russian buyer that is the narrowest point. The source of funds file is assembled before the deposit, not after.
Traps
Paying outside escrow. Sending off-plan money to a "convenient" developer account forfeits the protection of Article 9 of Law No. 8 of 2007. Verify the account against the DLD register, not against a manager's email.
Service charges "to be confirmed later." The rate per square foot is the only genuinely recurring cost of ownership, and in prime towers it eats a visible share of rental yield.
A company "for privacy." There is no anonymity: the beneficial owner register is mandatory, while the wrapper switches on 9% corporate tax and disqualifies the asset from a personally held Golden Visa.
A mortgage-funded Golden Visa priced off the contract. The AED 2 million threshold is tested against the value recorded by the DLD, not the purchase price: a unit bought at AED 2.2 million that values below the threshold will not produce a visa. The conditions changed during 2026 — confirm them at the date of filing.
Succession "later." A DIFC or ADJD will is drawn up in the same weeks as the transaction. Rearranging the structure after the title is registered costs another 4% to enter the new configuration.
This material is for reference purposes and does not constitute individual legal advice.