What it costs to own an apartment in Dubai

The purchase price is only the first line. To compare an apartment’s return on an annual lease and as a holiday home honestly, you need every recurring cost of ownership and to know who pays it in each case. Below is the full list, a “who pays” table and the order in which to do the sums.

Owner costs under any arrangement

Service charge

The annual contribution to running the building and community: security, cleaning of common areas, lifts, pool, gym, and repairs to the facade and building systems. It is charged on the apartment’s area in dirhams per square foot. Each building’s budget is approved by the Dubai Land Department (RERA), and you can look up a building’s rate in the DLD service charge index. Buildings differ widely: a premium tower with hotel services and a rooftop pool can charge several times more than an ordinary residential building.

Insurance

Cover for the apartment and the owner’s liability. For short stays you need a policy that covers letting to guests — check this when you buy it.

Repairs and replacement

Air conditioning, plumbing, appliances, repainting. In Dubai air conditioning runs almost all year, so regular servicing is a fixed line in the budget.

Utilities

• DEWA — electricity and water.
• Cooling (chiller) — in some buildings air conditioning is billed separately by a district cooling provider. The bill usually has a fixed part that is charged even when the apartment is empty.
• Internet and TV.

On an annual lease the tenant pays the utilities; in a holiday home the owner does, and they are part of the apartment’s costs.

Extra costs of a holiday home

• DET permit — from AED 370 a year for a one-bedroom unit, up to AED 1,270 for four bedrooms or more.
• Booking platform commissions — Airbnb, Booking.com and others keep their share of each booking.
• Cleaning and linen after every guest.
• Supplies: toiletries, kitchen basics and the small things guests expect.
• Furniture and appliances: with guests changing all the time, wear is faster and refreshes come sooner.
• The management company’s fee, if an operator runs the home.

Who pays what: annual lease vs holiday home

Cost	Annual lease	Holiday home
Service charge	Owner	Owner
Home insurance	Owner	Owner
DEWA, cooling, internet	Tenant	Owner
DET permit	—	Owner
Furniture and appliances	Owner, if let furnished	Owner, refreshed more often
Cleaning, linen, supplies	—	Owner (part of the home’s costs)
Platform commissions	—	Deducted from each booking
Minor repairs	Usually the owner	Owner
Management	Agent — usually a one-off fee	Operator — a percentage

How to work out your own apartment

1. Take your building’s service charge rate from the DLD index and multiply it by the area.
2. Add insurance and an annual repairs budget.
3. For a holiday home, add 12 months of utilities, the DET permit, supplies and furniture refreshes.
4. From the expected guest revenue, deduct platform commissions and the operator’s fee.
5. Compare the result with an annual lease in your building minus service charge and repairs.

In our comparison calculator we assume: platform commissions of about 15%, utilities of about AED 1,100 a month, supplies of AED 8,000 and furniture refreshes of AED 9,000 a year. These are our assumptions for an average apartment, not a rule — for yours we calculate from your building’s actual figures. A worked example is in the article “Short-term or annual lease”.

How our owners see it

Owners see every expense on their apartment in the YOLO STAY app with a photo of the receipt. At the end of the month they get a statement: income, expenses, fee and the amount paid out. The fee is taken from the month’s result — income minus expenses — and there is none in a month with a loss.