Service Charges in Dubai Explained: The Cost That Eats Your Yield
Service charges are the running cost buyers most often overlook — and the one that quietly eats rental yield. Here is how they work and how to check them.
What service charges pay for
Service charges are the annual fees owners pay to maintain a building and its shared areas — security, cleaning, lifts, landscaping, pools, gyms and a reserve fund for major works. They are charged as an amount per square foot of your unit, so a larger apartment pays more, and an amenity-heavy tower charges more than a simple building.
How they are set and regulated
Service charges are set by the owners’ association/management and reviewed by the authorities, with fees administered through Dubai’s regulated service-charge system. Because they are approved and published, you can and should check a building’s current rate before you buy rather than discover it after.
Why they matter to your return
Service charges come straight off rental yield. Two apartments at the same price and rent can deliver very different net returns if one sits in a high-charge tower. For investors, the per-sqft service charge is as much a part of the deal as the price per sqft — factor it into your net yield before you commit.
Frequently asked questions
How much are service charges in Dubai?+
They are charged per square foot of your unit and vary widely by building — simpler buildings cost less, while towers with extensive amenities cost more. Always check the specific building’s current published rate before buying.
Do service charges affect rental yield?+
Yes, directly. Service charges are deducted from your rental income, so a high-charge building lowers your net yield even if the price and rent look attractive. Factor the per-sqft charge into any yield calculation.
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