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28 March 2024

DIFC hikes property registration fee from 3.5% to 5%

Published
By Parag Deulgaonkar

The Dubai International Financial Centre (DIFC) Authority has hiked freehold transfer fee for properties from 3.5 per cent to 5 per cent from April 1.

The moves aims to address the International Monetary Fund’s concerns about overinflated markets and endeavour to secure the long-term stability of the DIFC property market, the authority said in a statement.

In fact, a consultation paper No1 of 2014 was released earlier in which the DIFC Authority proposed amendments to its real property regulations relating to an increase of its freehold transfer fee.

The original proposal was to increase to 6 per cent, but was later revised to 5 per cent following investor comments.

The amendment to the real property regulations came into effect April 1, 2014.

“Though it’s a limited market, the move will still discourage people from buying and selling too quickly and also help DIFC generate more revenue,” Craig Plumb, Head of Research, JLL Mena, told Emirates 24|7.

This website reported in October 2013 that DIFC was seeking investment worth Dh15 billion through joint ventures to develop its remaining 10 million square feet land bank.

“We have 110 acres in our master plan, of which 25 million square feet has development potential.

“We have already built 15 million square feet and now we are building the remaining 10 million square feet, which will need investment of nearly Dh15 billion,” Brett Schafer, CEO, DIFC Properties, had said.

Of the 10 million square feet, 60 per cent of the land will be dedicated to offices, 25 per cent for residential and remaining 15 per cent for retail.

DIFC works as a separate entity with its own property laws and regulations.

The Dubai Land Department, whose laws and regulations govern rest of the emirate, increased its property transfer fee in October 2013 to 4 per cent from 2 per cent with the aim to curb speculative activity in the market.