Buyer Guides · 8 min read
Dubai property service charges explained
The EQT Private Office · RERA-registered brokerage · Published February 20, 2026 · Updated August 3, 2026
Service charges in Dubai are recurring annual fees property owners pay to fund the upkeep of shared areas, security, and building services, calculated per square foot of your unit. They are regulated by RERA and administered through the Mollak platform, which holds funds in dedicated accounts and keeps billing transparent. This guide explains how charges are set, what they cover, and how they affect your net rental yield.
Key takeaways
- •Service charges fund maintenance of common areas, security, cleaning, insurance and building systems in shared developments.
- •Charges are billed per square foot of your unit, so larger homes and premium buildings cost more to run.
- •RERA approves service-charge budgets and the Mollak system holds funds in dedicated accounts for transparency.
- •Charges vary widely by community and amenities, so factor them into your net yield before buying.
- •A reserve or sinking fund within the charge covers major future works like lifts, facades and roofing.
- •There is no property tax in Dubai, but service charges are an ongoing cost every owner must budget for.
What service charges are and why they exist
When you own an apartment or a home in a managed community, you share buildings, gardens, pools, lifts and infrastructure with other owners. Service charges are the mechanism that pays to keep all of that running and in good condition. Every owner contributes in proportion to the size of their unit.
Without a pooled fund, shared facilities would deteriorate and no single owner would be responsible for the lobby, the security team or the swimming pool pump. Service charges convert those collective needs into a predictable annual bill, so the development is maintained to a consistent standard that protects everyone's property value.
How Dubai calculates service charges
Charges are expressed as a rate per square foot and multiplied by the internal area of your unit. A building with a rate of, say, a given amount per square foot will bill a large apartment more than a studio in the same tower, because the larger owner consumes a larger share of shared resources.
The rate itself reflects the running costs of the specific development. Buildings with extensive amenities such as concierge, multiple pools, gyms and landscaped grounds carry higher rates than simpler blocks. RERA reviews and approves the service-charge budget that underpins the rate, and the approved figures feed into the Mollak billing system.
- •Rate per square foot multiplied by your unit's area gives the annual charge.
- •Higher-amenity buildings carry higher rates than basic developments.
- •RERA approves the community's budget before charges are levied.
- •Mollak holds collected funds in dedicated accounts and issues transparent invoices.
- •Rates can change year to year as the approved budget and actual costs shift.
What the charge actually covers
Owners often want to know exactly where the money goes. A well-run community publishes a budget that breaks the charge into clear categories, so you can see that you are paying for genuine upkeep rather than an opaque lump sum.
- •Cleaning and maintenance of lobbies, corridors, gardens and shared amenities.
- •Security, including guards, access control and surveillance systems.
- •Building insurance for the common structure and shared liability.
- •Utilities for common areas, such as lighting, water features and cooling.
- •Management fees for the appointed owners' association manager.
- •A reserve or sinking fund set aside for major future repairs and replacements.
The Mollak system and where your money sits
Mollak is the government-backed platform that governs service-charge collection and disbursement for jointly owned properties in Dubai. It was introduced to bring transparency to a process that previously varied widely between developments, and it now sits at the centre of how charges are handled.
Under Mollak, owners' funds are held in dedicated escrow-style accounts tied to each community, and management companies must operate within RERA-approved budgets. Invoices are generated through the system, so owners can see the approved rate and what they owe. This structure reduces the risk of funds being misused and gives buyers confidence that charges reflect real, sanctioned costs.
For buyers, the practical benefit is transparency you can verify. Because the rate is approved and the billing runs through a central platform, you are not relying on a management company's word alone. You can trace what you pay back to a sanctioned budget, which makes it far easier to compare communities and to challenge a charge that looks out of line.
How charges affect yield and what to check before buying
Service charges directly reduce your net rental yield. A property advertised at a gross yield of, for example, the upper end of the 6-9% range will return less once the annual charge is deducted, so smart investors always calculate returns after service charges rather than before.
Because rates vary so much between communities, the charge can be the deciding factor between two otherwise similar units. A cheaper apartment in a high-charge tower may deliver a worse net return than a pricier one in an efficiently run building.
- •Ask for the current per-square-foot rate and multiply it by the unit's area before you offer.
- •Request the community budget to see how the charge is split and whether a reserve fund exists.
- •Check for any arrears attached to the unit, since unpaid charges can transfer with the property.
- •Compare the net yield after charges, not just the headline gross yield.
- •Confirm the building is billed through Mollak so you know the charge is RERA-approved.
Frequently asked
How are service charges calculated in Dubai?+
Service charges are billed at a rate per square foot multiplied by your unit's internal area, so larger homes pay more. The rate reflects the running costs and amenities of the specific development, and RERA approves the budget behind it. Charges are then invoiced through the Mollak system, which keeps the figures transparent and auditable.
What do Dubai service charges cover?+
They cover the upkeep of shared areas and services: cleaning, security, building insurance, common-area utilities, management fees and maintenance of amenities like pools, gyms and lifts. Part of the charge also feeds a reserve or sinking fund for major future works such as facade repairs or lift replacement, spreading large costs over time.
What is the Mollak system?+
Mollak is Dubai's government-backed platform for administering service charges on jointly owned property. It holds owners' funds in dedicated accounts, requires management companies to work within RERA-approved budgets, and generates transparent invoices. The system was introduced to standardise charge collection and give owners confidence that their money funds genuine, sanctioned community costs.
Do service charges reduce my rental yield?+
Yes. Service charges are an annual owner cost that lowers your net return, so you should calculate yield after deducting them rather than relying on the gross figure. With gross yields commonly in the 6-9% range, an efficiently run building preserves more of that return than a high-charge tower with heavy amenities.
Are there any taxes on property in Dubai besides service charges?+
No. Dubai has no annual property tax, no capital gains tax and no tax on rental income. Service charges are not a tax; they are a maintenance contribution to your community. Your main one-off costs are the 4% DLD transfer fee and around 2% agency commission plus 5% VAT, with service charges recurring yearly.
