When it comes to buying, selling, or renting a property in Dubai, most people rely on real estate agents to guide them through the process. They earn their income through real estate agent commission law in Dubai
Dubai’s real estate brokers earned more than AED 3.23 billion in commissions. This is nearly double what they earned in the same time during 2025, which was AED 1.62 billion. The commission amount went up by 99% ( Business Recorder).
A commission is simply the fee you pay your agent for their services. It is usually a percentage of the property’s selling price or yearly rent. This fee is not just a charge but the price of professional help, market knowledge, and peace of mind.
In this complete 2026 guide, we will break down how real estate commissions work in Dubai, who pays them, the legal rules, and how you can even negotiate them.
Real Estate Agent Commission Law: RERA Rules and Regulations
Here is what you should know:
- In Dubai, only agents holding a valid license from RERA are permitted to charge a commission. If someone does not have a license and requests a commission, they are violating the real estate agent commission law in Dubai.
- Agents must tell you the commission rate before you sign any deal. They cannot surprise you with extra charges at the last minute.
- The agreed commission rate must be written in the contract to protect both you and the agent.
- Agents must not add any hidden fees on top of the commission you agreed on.
Always ask your agent to show their RERA license. This proves they are legally allowed to work as an agent in Dubai.
How are Real Estate Agent Commissions Calculated?
In Dubai, commissions are usually charged as a percentage. So, if the property price is higher, the commission amount also increases, even though the percentage does not change.
Standard Real Estate Commission Rates in Dubai 2026
- Property Sales: Around 2% of the final sale price, plus 5% VAT.
- Rentals (Residential): the commission is 5% of the yearly rent, or at least AED 5,000, whichever is higher..
- Commercial Rentals: 5–10% of the annual rent, plus 5% VAT.
- Off-Plan Sales: the commission can go up to 8%. However, it is normally paid by the developer, not the buyer..
Example Calculations of Real Estate Agent Commission
- If you buy a villa worth AED 1,000,000, the agent’s commission = AED 20,000 (2%) + VAT = AED 21,000.
- If you rent an apartment for AED 100,000 per year, the agent’s commission = AED 5,000 (5%).
- If you rent a commercial office for AED 200,000 per year, the agent’s commission = AED 10,000 to AED 20,000 (5–10%) + VAT.
You can also use the Dubai real estate commission calculator available online.
Rates of Rental Agent Commission Dubai by Property Type
| Property Type | Commission Rate | VAT Application |
| Residential Sales | 2% | 5% VAT on commission |
| Commercial Sales | 2–4% | 5% VAT on commission |
| Off-Plan Properties | Up to 8%, paid by the developer | Usually included by the developer |
| Residential Rentals | 5% of annual rent or AED 5,000 minimum | No VAT |
| Commercial Rentals | 5–10% of annual rent | 5% VAT on commission |
Who Pays Agent Commission in Dubai?
This is one of the most common questions in Dubai’s real estate market. The answer depends on the type of property:
- Resale Properties (Secondary Market): The buyer usually pays the agent a 2% commission (plus VAT). Sometimes, sellers also pay, but this must be in the contract.
- Rentals (Apartments or Villas): The tenant pays the commission, which is normally 5% of the annual rent or AED 5,000 (whichever is higher).
- Off-Plan Properties (Under Construction): The developer pays the commission to the agent, so the buyer doesn’t pay extra.
- Commercial Properties: Commission responsibility can vary, but usually, the tenant or business pays for rentals, and the buyer pays for sales.
Always confirm who is paying before signing the agreement.
How Real Estate Commissions Work in Practice
This is what goes on behind the scenes with commissions in Dubai’s real estate market:
- Agents do not keep the full commission themselves. Usually, they split it with their brokerage agency, typically 50/50, but the split can vary depending on company policies. Top-performing agents may get a larger share, while those with salaries might receive less than 50% of the commission.
- When two agents work together on one deal (one representing the buyer, the other the seller), Dubai requires them to use an Agent-to-Agent Agreement called Form I. This form ensures both agents get their fair share of the commission.
- To avoid confusion and disputes, Dubai allows only up to three agents to list the same property at the same time. This rule prevents multiple agents from claiming commission on the same transaction.
4 Important Factors Affecting Commission & Negotiation Tips
Commission rates in Dubai can vary due to several factors:
1. Type of Property
Commercial property commissions tend to be higher than residential ones because commercial deals often require more work and take longer.
Commercial sales commissions range from 2% to 4% of the sale price, and commercial rentals have commissions of 5% to 10% of the annual rent, usually paid by tenants.
2. Market Conditions
When the market favors sellers and demand is high, agents usually charge the standard commission (about 2% for sales). But in a buyer’s market with less demand, agents may lower their commission rates to win more clients.
3. Experience of the Agent
Experienced and top agents may charge higher commissions due to their expertise, which can save clients’ money in the long run. Newer agents might offer lower rates to build their client base.
4. Agency Policy
Large agencies often have fixed commission rates, while smaller agencies or independent brokers might offer more flexible or negotiable commission fees.
Tips Of Negotiation
- In Dubai’s real estate market, you can always ask for a lower commission rate before signing any agreement.
- If you are buying or renting multiple properties, agents are often willing to offer discounts on their commission to secure your business.
- Always write the agreed commission rate in the contract to prevent future misunderstandings or disputes.
- These practices help ensure transparency and fairness for both buyers and agents in property transactions
Legal & Tax Aspects for Real Estate Commissions
Dubai has clear legal and tax rules for commissions:
Licensing: Only RERA-licensed agents can collect commission.
Contracts: Commission must be agreed in a written contract (Form A, B, or I, depending on the deal).
VAT (5%):
- Applies to sales commission.
- Applies to commercial rental commission.
- Does not apply to residential rentals.
- Invoices: Agents must issue VAT-compliant invoices.
If an agent asks for cash without receipts, it’s a red flag. Always demand proper documentation.
Alternative Real Estate Commission Models
Dubai’s real estate market is changing. Besides the usual commission percentage, there are other ways agents get paid:
- Some agencies offer lower commission rates as special deals.
- Some agents charge a flat fee, which means you pay a fixed amount no matter how expensive the property is. This can be good for very costly properties.
- Discount agents offer cheaper services but may provide fewer features, such as less marketing.
- Online websites and apps connect buyers and sellers directly. Sometimes, these platforms work without agents, helping you save money.
These new options can save you money, but they may not give you as much personal help and advice as a traditional real estate agent would.
5 Benefits & Impact of Paying Real Estate Commissions in Dubai
Commissions might seem like extra costs at first, but they are worth it because:
- Agents know the market well. They understand prices, trends, and demand, helping you avoid paying too much or selling too cheaply.
- Agents have access to many listings and buyers you might not find on your own.
- Licensed agents make sure contracts are correct and help prevent fraud.
- Agents save you time by handling calls, viewings, negotiations, and paperwork.
- Even after paying commission, the better deals agents help you get can save or make you more money in the long run.
In short, paying commission gets you expert help, protects your interests, and often leads to better results
Future Trends in Real Estate Commission Structures
The future of Dubai’s property market is becoming more flexible and digital with these trends:
- Performance-Based Fees: You pay the agent only if they achieve a specific result, like selling your property.
- Subscription Models: Instead of big commissions, you pay a small monthly fee to access property listings.
- Hybrid Services: Online platforms combine with professional agents to offer the best of both worlds.
FAQs: Real Estate Agent Commission Law
Who pays the commission in Dubai?
Buyers pay for resale properties, tenants pay for rentals, and developers pay for off-plan properties.
Can I negotiate the commission?
Yes. The commission is not fixed by law. You can discuss it before signing contracts.
Is VAT charged on commissions?
Yes, 5% VAT applies to sales and commercial rentals, but residential rentals are exempt.
Can unlicensed agents charge commission?
No. Only RERA-licensed agents are legally allowed.
What is the commission rate for commercial properties?
Sales: 2–4%. Rentals: 5–10%, plus VAT.
Key Takeaways: Real Estate Agent Commission Law in Dubai
- Sales commission: 2% of property price (plus VAT).
- Rental commission: 5–10% of annual rent (VAT on commercial only).
- Who pays: Buyers (resale), tenants (rentals), developers (off-plan).
- Always use licensed agents: To stay safe and avoid fraud.
- Commissions can be negotiated: Always agree in writing.
- The future is flexible: Expect more digital and low-cost options.
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