Dubai Rent vs Buy Calculator 2026
Compare the total cost of renting against buying the same Dubai property over 5, 7 or 10 years — DLD fees, mortgage interest, service charges, growth and resale — to see which leaves you better off.
| Upfront buying costs (DLD 4% + fees + 2% agency + 0.25% mortgage reg.) | — |
|---|---|
| Mortgage: amount / monthly payment | — |
| Total cost of owning over the period (interest + service + maintenance + costs) | — |
| Property value at the end / equity after selling costs | — |
| Net cost of buying (cash out − equity back) | — |
| Total rent paid over the period | — |
| Less: investment growth on the cash you kept | — |
| Net cost of renting | — |
| Break-even year | — |
In short
In Dubai, buying costs about 6.5% upfront (4% DLD fee, 2% agency, admin and mortgage registration) and 2% to sell, so it usually beats renting only after 4–8 years; it wins sooner when the gross rental yield (commonly 5–8%) exceeds the mortgage rate plus roughly 1.5% for service charges and maintenance, and later when prices stagnate.
Who this is for: Dubai residents deciding whether to keep renting or buy, and investors checking whether a purchase beats renting over their expected stay.
How the comparison works
Both paths are costed as cash flows over the years you plan to stay:
- Buying: down payment + upfront costs (4% DLD transfer fee, AED 580 admin, 2% agency, 0.25% mortgage registration) + mortgage interest + service charges (rising 3% a year) + 1% a year maintenance — minus the equity you get back when you sell (value grown at your rate, less 2% selling commission and the mortgage balance).
- Renting: rent rising at your chosen rate — minus the investment return on the cash you did not tie up (the down payment and buying costs).
The break-even year is the first year in which buying's net cost drops below renting's. Dubai's ~6–7% transaction costs mean buying rarely pays within 3 years; with 5–7% gross yields and modest price growth it usually overtakes renting between years 4 and 8.
Not modelled: rent-free periods, chiller or DEWA differences, the ILOE/ visa benefits of ownership (Golden Visa at AED 2 million), currency risk, or tax in your home country.
Assumptions
- Buying cash flows: down payment + DLD 4% + AED 580 + 2% agency + 0.25% mortgage registration + interest on a 25-year mortgage + service charges (rising 3% a year) + 1% maintenance; equity returned = value grown at your rate × 98% − remaining balance.
- Renting cash flows: rent rising at your rate, less the growth at your return rate on the cash not tied up.
- Break-even = first year buying's net cost is below renting's; results depend heavily on the growth rates entered.
Worked example
Upfront costs ≈ AED 94,000; mortgage AED 1.2m at AED 6,670 a month. Over 7 years: interest ≈ AED 346,000, service and maintenance ≈ AED 220,000.
Value after 7 years ≈ AED 1.845m; equity after selling costs and the remaining balance ≈ AED 822,000. Net cost of buying ≈ AED 139,000.
Rent over 7 years ≈ AED 728,000, less ≈ AED 160,000 investment growth on the AED 394,000 kept = net cost of renting ≈ AED 568,000. Buying wins from year 2 on these assumptions; at 0% price growth the gap narrows sharply.
Frequently asked questions
What yield makes buying better than renting in Dubai?
As a rule of thumb, when the gross rental yield exceeds the mortgage rate plus about 1.5% for service charges and maintenance — e.g. a 6.5% yield against a 4.5% mortgage — buying is cheaper than renting almost immediately after the transaction costs are absorbed.
How long do I need to stay for buying to pay off?
Usually 4–8 years in Dubai, because the ~6.5% buying and 2% selling costs have to be recovered. Shorter than that, renting generally wins unless prices rise quickly.
Does the calculator include mortgage affordability?
No — use the UAE mortgage affordability calculator to check the Central Bank LTV and 50% debt-burden limits first.
What about buying off-plan?
Off-plan has a different cash-flow shape (instalments, no rent saved until handover, 50% LTV cap on mortgages); use the off-plan payment plan calculator for that.
Is it cheaper to rent or buy in Dubai?
Over 5+ years buying is usually cheaper when the yield is above the mortgage rate and prices grow modestly; for stays under 3–4 years the 6.5% buying and 2% selling costs make renting cheaper.
What are the costs of buying property in Dubai?
About 6.5–7% of the price: 4% DLD transfer fee, AED 580 admin, 2% agency commission, 0.25% mortgage registration plus bank valuation and arrangement fees.
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