If you thought buying property in Dubai or Abu Dhabi property was an expensive business, do your sums carefully – it could be even more costly than you think.

Too many buyers fail to allow for all the extra costs, fees and charges involved in purchasing real estate in the UAE. The total cost can add another 10 percent to the price.

If you’re selling a property as well, your costs at that end of the transaction could quickly exceed more than AED 10,000, which only adds to the expense.

Rising buying costs

There are a string of different fees to watch out for from different bodies and commercial organizations when buying property, including government bodies such as the Dubai Land Department, your developer, lender, estate agent and conveyancing lawyer.

[Related: Buying property in the UAE for the first time | 10 things you need to know about buying property | Understanding mortgages]

Some of these costs have risen lately in Dubai, following the decision by the Dubai Land Department to double its transfer fee, from two to four percent of the property value. In Abu Dhabi, the transfer fee ranges from one to two percent.

The mortgage fees you pay may depend on whether you take out a standard loan or Islamic finance; the latter can be more expensive.

Need ready cash

If you’re planning to buy, you need to work out the total cost in advance, to calculate how much you can afford to spend on the property itself.

[Compare UAE mortgages | Compare Islamic home finance]

And remember there are also ongoing fees, such as your developer’s annual service fee, and maintenance charges for the upkeep of your apartment or villa (water fees can really add up in a villa).

You may also need ready cash upfront, to put down at least 25 percent initial deposit to secure your chosen property.

Compound interest cost

And, if you use a mortgage to fund the rest of your purchase, you need to understand the total cost of compound interest over the term of the loan when you’re looking at buying property.

Say you borrow AED 2 million over a repayment term of 20 years, and pay an average interest rate of five percent over that time.

Over the term, you would repay a total of AED 3,167,788. That means you repay around AED 1.17 million purely in interest, on top of paying back the capital you borrowed.

Given all the expense, you may question whether you still fancy getting on the UAE property ladder. When you remember the cost of rent in the Emirates, though, it’s worth calculating the costs.

[Related: 10 things your landlord won’t tell you | How to negotiate your rent | Should you buy in the UAE or at home?]

Buying property: The costs

Service Cost (AED)
Dubai Land Department transfer fee 4% plus AED 540 administrative fee
Abu Dhabi transfer fee 1% to 2%
Registration fees AED 2,000 for property below AED 500,000
AED 4,000 for property above AED 500,000
Mortgage registration fee 0.25% of loan + AED 10 fee
Mortgage processing fee Up to 1% of loan amount
Estate agency fee 2% of purchase fee
Conveyancing fees (where appropriate) AED 6,000 to AED 10,000
Valuation fee AED 2,500 to AED 3,500
Oqood fee, for off-plan properties 4% of purchase price
Downpayment 25% of property cost *

* Variable scale – see full costs in this article: New cap on UAE mortgages

Selling property: The costs

Service Cost (AED)
No Objection Certificate (NOC) and admin fee AED 1,000 to AED 5,000
Mortgage discharge fees 1% of the remaining balance or AED 10,000 which ever is lower
Home loan closure fee (where appropriate) AED 2,500
Conveyancing fee (where appropriate) AED 6,000 to AED 10,000