Service charges in Dubai explained

What service charges pay for

In a building or community with shared areas, owners jointly fund their upkeep. Service charges typically cover:

• Cleaning and maintenance of lobbies, corridors, lifts, pools and gyms
• Security and concierge
• Shared utilities for common areas
• Building insurance
• Management company fees
• Contributions to a reserve fund for major future works such as lift or facade replacement

Charges vary with what the building offers. Buildings with extensive amenities, hotel-style services or complex systems tend to cost more to run.

How they are set and collected

Under Law No. 6 of 2019, an owners' association and a registered management company prepare an annual budget for the property. Budgets are submitted through DLD's Mollak system, which records them and allocates the cost across units, usually by area. Owners receive invoices and can view their account, payment history and the approved budget through Mollak. Master communities may levy separate master-community charges on top of building charges. For a deeper read of the budget itself, see understanding service charge budgets.

Who pays

The owner pays, not the tenant. Landlords factor service charges into rent and net yield (rental yield explained). When a property is sold, outstanding charges must be cleared before the developer issues its NOC (developer NOC explained). For off-plan, check the SPA for when service charges start, usually from handover.

How to check the current figure

1. Ask the seller or agent for the latest Mollak statement for the unit. 2. Ask what the approved budget is for the current year and whether any special levy is planned. 3. Check whether master-community charges are separate. 4. For off-plan, ask the developer for the estimated budget and how it will be set after handover.

Do not rely on figures quoted in adverts or online forums. Budgets change each year.

What service charges tell you about a building

A very low charge can mean under-maintenance or an inadequate reserve fund, storing up costs for later. A high charge may reflect generous amenities or inefficiency. Compare the charge with what you see on viewing: the state of lifts, lobby and pool, and how quickly issues are fixed. Ask whether audited accounts are available and whether the owners' association is active.

Disagreements and non-payment

Owners who believe charges are wrong can raise questions with the management company and the owners' association and escalate through DLD/RERA processes — see Mollak and service-charge disputes. Not paying is risky: unpaid charges can lead to penalties, restricted access to some services and blocked transfers. Confirm the current enforcement rules with DLD.

Common mistakes

• Budgeting yield without the current service charge
• Ignoring master-community charges
• Assuming tenants pay service charges
• Not asking about planned major works or reserve-fund health
• Buying a unit with arrears and discovering them at NOC stage

Service charges and chiller fees

In some buildings cooling is supplied by a district cooling provider and billed separately from service charges, either to the occupant or the owner depending on the building. Others include cooling costs within the service charge. Ask which applies before you buy or let, because it affects both your costs and what a tenant expects to pay. See chiller fees explained.