Understanding Property Fees in Dubai
Whether you’re renting or buying property in Dubai, dealing with the DEWA (Dubai Electricity and Water Authority) and the associated Housing Fee is unavoidable.
According to government regulations, all expatriates residing in Dubai are required to pay a Housing Fee. This fee is collected by the Municipality but is included in the monthly DEWA utility bill. The specific amount is 5% of the annual rent, divided by 12, and charged monthly.
For those living in their own property without a rental contract, the fee is calculated based on the RERA (Real Estate Regulatory Agency) rental index. For example, if Mr. A owns a three-bedroom townhouse in Dubai and uses it as his residence, and the RERA rental guide indicates an annual rent of 220,000 to 250,000 AED, Mr. A would need to pay a Housing Fee of 5% of 250,000 AED, which is 12,500 AED annually. This breaks down to 1,042 AED per month added to his utility bill. The fee is calculated using the highest value from the government’s rental guide, which is why 250,000 AED is used instead of 220,000 AED.
You might wonder why your neighbor, who also owns their property, doesn’t pay a Housing Fee. Here are some possible reasons:
1️⃣ They might be a local citizen! Local citizens are exempt from this fee.
2️⃣ They might have been lucky and somehow missed being billed. This is a common occurrence and contributes to the misconception that owner-occupants don’t have to pay the Housing Fee. This is quite typical in Dubai; if your monthly bill shows 0 for the Housing Fee, consider yourself fortunate!
By understanding these nuances, you can better navigate the intricacies of property fees in Dubai.