Dubai land Dept fees

[jag]

While I am aware that the Dubai Land Dept fee was doubled last October 2013 from 2% to 4% of the purchase price, can anyone confirm who is responsible to pay this fee? I have received mixed info - It could be payable by the Developer, the Buyer or split between the two. Accurate clarification is difficult to come by.
Any firm facts would be most welcome. Thank you

 

[Rich_T]

When purchasing a property from a private seller (ie not a developer) then the law states that it should be split 50/50, this is also confirmed on the Land Departments Website.

However in reality it is almost always the buyer who pays the full 4%. The reason is that the vast majority of sellers list their properties for sale at a price that is NET to them and it is common practice for buyers to bear all the transfer costs (with the exception of the NOC) which at present include the following (presuming you are paying in cash):

> 4% of the agreed sales price as a transfer fee
> 2% of the agreed sales price to the agent
> 540 AED to produce and register the title deed
> 4000 AED to the transfer office

Ultimately what part you pay is determined by what is written in the MOU as this is the sales agreement between both the parties, so it is possible to negotiate that the sellers pays 2% transfer fee's.

If purchasing through a developer then it is always the buyer who pays the 4% registration if the property if off plan.

If the property is complete then again the vast majority of developers will expect you to pay the full 4%, I have only ever come across one developer who was willing to split the 4% 50/50.

 

[jag]

Rich_T
Thank you for your reply and clarification of my queries. Since at the point of drafting a purchase agreement 5 years ago, we had no knowledge of the possible 50:50 split. So of course it was not mentioned in the MRO and we must pay the whole 4%.
I have a further question. We are now at the point of requesting the title deeds and on top of the various transfer fees and admin fees, we also have to pay ERES. Can you tell me who is/are ERES and why do they also want my money? I tried to find them through Google and they seem to be part of DLD but what part do they play?
Thank you again, jag

 

[Rich_T]

ERES stands for Emirates Real Estate Solutions and they are the providers of the Ejari system (Ejari is where tenants and landlords register their tenancy contracts) and Oqood (which is proof of ownership for off-plan properties). As to why you have to pay them a fee is beyond me.

Can you just clarify for me; did you purchase this property 5 years ago from a developer and you are now in the process of applying for the title deed?

 

[jag]

No, we purchased the property from a private owner and having completed all mortgage payments we are now applying for the title deeds. However, being an apartment, it is managed by the developer. So I believe we have to go through the developer to obtain the deeds. They issued a 'payment structure' which includes:

AED 500 Developer's admin fees
4% of original price to DLD
AED 550 DLD admin fees
0.25% of original mortgage to DLD
AED 500 to ERES (the purpose is not defined)

 

[Rich_T]

I have absolutely no idea why they would be charging you an ERES fee. I can only assume that its a charge that a developer would normally pay when obtaining a title deed on your behalf and they have passed the cost onto you.

 

[jag]

Thank you again Rich_T.
In the UAE what is the advantage of obtaining the title deeds and what is the implication of not obtaining the deeds. Having paid all the requested fees at the time of purchase, we now must pay AED 50,000 to get the deeds for us.
jag

 

[Rich_T]

The title deed is the official proof of ownership. However there are thousands upon thousands of property owners who have never applied for theirs.

Before the Oqood registration was implemented, many owners who bought a property off plan only had a Sales Purchase Agreement (SPA). Contained within the SPA you had the sales agreement terms, the buyers name(s) and developer/seller(s) name with every page bearing the developers stamp. This document is sufficient proof of ownership to allow you to rent the apartment, connect DEWA (Water and Electricity) and DU/Etisalat (TV, internet and phone).

Ideally their government wants you to apply for the title deed so that they can make their 4%, and in the past have bought in schemes which been designed to try and force people into applying for their title deed. Personally I would advise that you do apply for it as it is the only official document which proves ownership and therefore is very valuable should anything happen in the future.

In reality the only time you would require the title deed is if you were to sell the property or apply for a visa on the back of that property.

 

[Alwasol2020]

for unfinshed Project there only Ownership of Property is Called " OQOOD " which is prepared by RERA for Registered Developers with Registered Properties

For Complete Projects the Ownership is called : Title Deed
issued by the DLD
which you the buyer should pay 4% of the Property value to DLD .it can be also 2% if only pre agreed with seller to share the other half

 

[RiyazPatel]

Duabi registration fees

hi
I purchased a property from a developer in dubai in 2007 and by 2009 i had paid for it in full. The property is finally nearly complete and i got a chaser a few days ago asking me to pay 4% registration fee by the 30th june. I so the dubai land legistry has extended this deadline by 4 months so i have not yet paid anything.

I have complained to my developer ACW holdings as to why they left it til now to register the property when they could have done it prior to 2013 when the rate was 2%and i believe at that time both the buyer and the developer had to pay 1% each.

My question really is as i purchased the property prior to 2013 before the rate increase to 4% what is my legal position.

 

[speedpete]

Hi RiyazPatel,

I have the same problem. Can you contact me on "peter.true (add) get2net.dk"? I would like to "share notes" with you as I've been in discussion with both EMAAR, Dubai Land Department and HSBC (since my property is mortgaged) - in regards to the title deed problem.

BR
Peter