Dubai housing fee to be mandatory from January 1

All occupants of residential units in Dubai will compulsorily have to pay housing fees from January 1, 2011, as the Dubai Municipality aims to bring in around 300,000 unit occupants who are evading the fees, a top government official told Emirates Business.

Abdulla Hashim Abdulghafoor, Head of Housing and Marketing Fees at the Dubai Municipality, said the municipality expects to earn revenues of between Dh500 million and Dh600m by 2011 end from the housing fee collection, primarily from people who are currently not paying the fee.

Citing Dubai Electricity and Water Authority (Dewa) estimates, Aref Abdulrahman Ahli, Director of the Finance Department at the Dubai Municipality, said: "There are around 300,000 units that are Dewa consumers, but are not currently paying the housing fee."

He said: "All unit occupants in Dubai, whether villas/apartments in free zone or freehold areas, will be [required] to pay the housing fee. We have set a time line of January 1, 2011, by when we expect all these units to start paying the housing fee." However, freehold property owners will now not be charged 0.5 per cent of their annual sales contract value, but the fee will be charged at five per cent annually of the average Rera rental index for that particular community.

Leasehold occupants (tenants) will continue to pay five per cent of the annual rent as housing fee. Abdulghafoor said: "We understand the rental index estimates are broad, hence we will take the average for the property.

"We cannot take every aspect of a property unit like whether it is sea-facing or not as then we will have to investigate all the aspects. But we will take a broad average."

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