Agent commission in Dubai: 2% on resale, 5% on rent, nothing on new-build

"What does the agent charge?" is the first question on almost every first call, and the answer depends entirely on what you are buying. Resale, rental and new-build work on three different models, and confusing them costs real money.

Resale: 2% of the price

The standard commission on a completed property is 2% of the sale price, and by settled practice the buyer pays it. VAT at 5% is charged on top of the commission itself. Where buyer and seller are represented by different agencies, the fee is split between them under an agreement — the buyer's total does not change.

An important qualification: 2% is market custom, not statute. The regulator recognises it as standard but neither sets nor enforces it, and the parties are free to agree otherwise. On larger tickets the rate is negotiable, and negotiating it is a normal part of the transaction rather than an insult.

Rental: 5% of the annual rent

On a residential letting the agent's fee is calculated on the annual rent and is typically 5%. On cheaper units agencies often apply a minimum in absolute terms. Again — practice, not tariff.

New-build: the buyer pays nothing

Buy directly from a developer and the commission is paid by the developer, not by you. The price on the developer's list is the same whether you walk in alone or arrive with a broker. This is worth understanding before you start looking: on the primary market a broker's work costs the buyer nothing, and declining representation saves you nothing at all.

The other side of the same mechanism: because the developer pays, the broker has a commercial interest in showing you the developers their agency has agreements with. The check is simple — ask to see alternatives from other developers and to hear why they are worse.

Everything else a buyer pays

Commission is not the largest line. On the resale market the full set looks like this:

• 4% of the price — Land Department transfer fee. Formally split between the parties, in practice paid in full by the buyer.
• Administrative fee for issuing title — a fixed amount depending on property type.
• Trustee office fee — fixed, and depending on whether the price is above or below AED 500,000.
• Developer NOC — the no-objection certificate confirming no outstanding dues. Chargeable, at a price the developer sets.
• Mortgage costs if financed: registration of the charge with the Land Department plus bank fees and valuation.
• Service charge in advance. Transfer generally requires dues to be clear on the unit, and the remainder of the year is often settled up front.

All in, budget roughly 6–8% on top of the price on a resale, depending on whether there is a mortgage and how the fixed fees land. None of that appears in the listing, and it needs to be in your budget from the start.

Why the rate is lower than in New York or London

Residential commission in the United States traditionally starts around 5% and is split between sides, on a considerably higher price per foot. Dubai's 2% looks modest by comparison, and the reason is structural rather than qualitative: a large share of turnover here is primary market, where the developer pays, and competition among thousands of licensed agencies holds the resale rate down.

Get it in writing

Any agreement on commission belongs in a Land Department form — Form A when working with a seller, Form B when working with a buyer. "We'll sort it out later" in practice means sorting it out at the moment when walking away has become expensive.