Quick answer: No law fixes real estate commission in Dubai. Article 27 of Bylaw No. 85 of 2006 says a broker's pay is "determined by agreement", falling back on "prevailing practice" only when nothing was agreed. About 2% on sales and up to 5% of annual rent on leases are market norms, not legal rates. VAT-registered brokerages add 5% VAT.
Key takeaways
The rate is whatever the written agreement says. Dubai's brokerage bylaw sets no percentage.
2% on sales and up to 5% on rentals are what the market usually charges. You can agree a different figure.
The party that appointed the broker pays, and only once a deal is concluded, unless the agreement says otherwise.
5% VAT is added when the brokerage is VAT-registered.
The agent's share comes from their contract with the brokerage. DLD does not regulate it.
Rules last verified: 4 October 2026.
Is 2% commission the law in Dubai?
No. Dubai brokers are governed by Bylaw No. 85 of 2006 Regulating the Real Estate Brokers Register, published by DLD in its real estate legislation compilation. It contains no commission percentage. (New to the licence side? Start with how to become a real estate agent in Dubai.)
Rule: "The Real Estate Broker's remuneration will be determined by agreement, and in absence of agreement, remuneration will be determined according to prevailing practice." Bylaw No. 85 of 2006, Article 27 (DLD legislation PDF, p. 140).
So 2% matters legally only as a fallback, when nobody wrote a figure down. DLD's FAQ puts it the same way: brokers complete transactions "for a specific fee to be agreed upon in advance with a customer".
Dubai real estate commission rates in practice
Sales: about 2%
On secondary (ready) sales, Bayut's agent portal describes 2% as what is usually charged. That is custom, not a rule. A brokerage can agree 1.5% or 2.5% in writing.
Rentals: up to 5% of the annual rent
The UAE government's page on leasing a property tells tenants that "some brokers may require a commission fee, up to 5 per cent of the total amount of rent". It cites no law setting that figure. Some agents set a flat minimum on cheaper units; no regulation sets one either.
Off-plan: set by the developer's agreement
On off-plan sales the developer usually pays the brokerage. RERA's Brokerage Practice Guide requires a marketing contract between the developer and the brokerage, and that contract sets the rate and the payout timing. There is no standard figure.
Watch out: off-plan buyer money goes into the project escrow account. Under Article 12 of Executive Council Resolution No. 6 of 2010, a broker may not "deduct his commission from such proceeds before depositing it in the escrow account" (DLD legislation PDF).
Dubai real estate commission calculator: worked examples
| Deal | Rate | Commission | With 5% VAT |
|---|---|---|---|
| AED 1,000,000 sale | 2% | AED 20,000 | AED 21,000 |
| AED 2,000,000 sale | 2% | AED 40,000 | AED 42,000 |
| AED 5,000,000 sale | 2% | AED 100,000 | AED 105,000 |
| AED 120,000 a year rent | 5% | AED 6,000 | AED 6,300 |
| AED 80,000 a year rent | 5% | AED 4,000 | AED 4,200 |
Multiply the price (or the annual rent) by the agreed rate, then add 5% if the brokerage charges VAT. The rates here are market norms used for illustration; your agreement decides the real figure.
Who pays real estate commission in Dubai?
Legally, the party that appointed the broker.
Rule: the broker is "entitled to remuneration paid by the party that appoints him to conclude the transaction". If both sides appointed the broker, "each party will be severally liable to pay his own share", even if they agree one of them will pay it all. Bylaw No. 85 of 2006, Article 33.
On secondary sales the buyer commonly pays the buyer-side commission, and a seller's commission is agreed in some deals. On rentals, the government's tenant guidance warns tenants to expect it, but what counts is who appointed the broker and what the agreement says.
Where the commission is written down: Contracts A, B and F
RERA's Practice Guide says brokers "must commit to using smart contracts":
Contract A: seller and brokerage, to market the property. DLD's Contract A guide includes a commission step, and the owner approves by link.
Contract B: buyer and broker. The Contract B guide includes contract duration and commission.
Contract F: seller and buyer, the sale agreement (MOU), built from an approved A and an active B.
Co-broking agreements between agencies are common, but the Practice Guide lists only A, B and F as smart contracts.
When is the commission paid?
Under Article 28, the broker earns commission only if a contract is concluded between the parties, and it falls due when the sale contract is signed and registered with DLD, unless the brokerage agreement says otherwise. If the sale depends on a condition, such as mortgage approval, commission waits until the condition is met. If negotiations fail, the broker cannot claim compensation or expenses unless the agreement allows it (Article 30).
Two more rules worth knowing: a broker who acts for the other side against their own client loses the commission (Article 23), and where several brokers work for one side on the same deal, they split one fee between them (Article 31).
Is there VAT on real estate commission in the UAE?
Yes, when the brokerage is VAT-registered. The standard rate is 5% under Article 3 of Federal Decree-Law No. 8 of 2017. The FTA's real estate VAT guide treats estate agents' fees as carrying VAT even when the residential resale itself is exempt. Registration is mandatory once taxable supplies pass AED 375,000 a year. The agreement should say whether VAT is included or added.
How much commission do Dubai real estate agents make?
The agent earns a share of the brokerage's commission, set by the agent's contract with the brokerage. DLD does not regulate the split. Bayut's agent portal said in 2023 that 50:50 is most common, but that is an industry view, and splits vary with experience, lead source and whether the agent has a salary.
Example: on an AED 2,000,000 sale at 2%, the brokerage earns AED 40,000 before VAT. On a 50:50 split, the agent's share is AED 20,000. If the deal came through a co-broker, the side's fee is divided first.
Law vs market practice: summary
| Question | What the law says | Market practice | Who decides |
|---|---|---|---|
| Sales commission rate | No rate; set by agreement (Art. 27) | About 2% | Client and brokerage, in Contract A or B |
| Rental commission rate | No rate; same Art. 27 rule | Up to 5% of annual rent | Client and brokerage, in the leasing agreement |
| Off-plan commission | No rate; developer marketing contract required | Developer pays the brokerage | Each developer's agreement |
| Who pays | The party that appointed the broker (Art. 33) | Buyer, on many secondary sales | The written agreement |
| When it is due | On signing and DLD registration, unless agreed otherwise (Art. 28) | On transfer | The written agreement |
| VAT | 5% standard rate | Added on top | Law, if the brokerage is VAT-registered |
| Agent and brokerage split | Not regulated by DLD | Varies; 50:50 often quoted | The agent's contract |
| Disputes | DLD council only if agreed in writing (Art. 35) | Settle, then court | The parties, then the courts |
What happens if there is a commission dispute?
Under Articles 34 and 35, a council at DLD settles brokerage disputes, but only if the brokerage agreement provides for amicable settlement by DLD, or both sides later agree to it in writing. Once a file is referred, the council must decide within 30 days (Article 38). The Practice Guide also offers amicable settlement of Contract F disputes through Trakheesi; if that fails, the parties go to court.
Checklist: agreeing commission in writing
The right smart contract is signed: Contract A with the seller, Contract B with the buyer.
The commission is a stated percentage or a fixed AED amount, not "as per market".
It says whether VAT is included or added.
It names who pays, and each side's share if both appointed you.
It says when payment falls due, and any condition such as mortgage approval.
Exclusivity and contract duration are filled in.
Any co-broking split is agreed in writing before viewings.
It states whether disputes go to DLD for amicable settlement.
The signed contract is saved and the invoice is sent.
Keeping track once the commission is agreed
Commission is mostly paperwork: the right contract, the right figure and a record you can find months later. In Majlis CRM, a won lead opens a deal with the brokerage's commission rate for that deal type and each agent's share, and the brokerage issues UAE tax invoices with VAT and its TRN for the commission and any SPA installments, with the documents kept against the same deal (payments and documents). For brokerage owners, it also helps to keep clients when agents leave. To see it on your own deals, book a demo.
Frequently asked questions
Is 2% commission mandatory in Dubai?
No. Article 27 of Bylaw No. 85 of 2006 says a broker's commission is set by agreement, and "prevailing practice" applies only when nothing was agreed. About 2% on secondary sales is the common market figure, but a buyer, seller and brokerage can agree a different rate, written into the DLD smart contract (Contract A or B).
What is the real estate agent commission in Dubai for rent?
No law fixes it. The UAE government portal tells tenants that some brokers may require up to 5% of the total annual rent, which is the common market norm, and some agents set a flat minimum on cheaper units. The figure, and who pays it, should be written into the leasing agreement before the tenancy is signed.
Who pays real estate commission in Dubai, the buyer or the seller?
The law says the party that appointed the broker pays (Article 33). If both buyer and seller appointed the same broker, each owes their own share, even if they agree one side will pay it all. On many secondary sales the buyer pays the buyer-side commission. What counts is what is written in Contract A or Contract B.
Is there VAT on real estate commission in the UAE?
Yes, when the brokerage is registered for VAT, which is mandatory once taxable supplies pass AED 375,000 a year. Brokerage fees carry the 5% standard rate even when the property sale itself is exempt. On AED 40,000 of commission, VAT adds AED 2,000. The agreement should say whether VAT is included or added.
How much commission do real estate agents make in Dubai?
An agent earns a share of the brokerage's commission, set by their own contract; DLD does not regulate it. A 50:50 split is often quoted. On an AED 2,000,000 sale at 2%, the brokerage earns AED 40,000 before VAT, so a 50:50 agent would take AED 20,000.
When does a Dubai broker get paid?
Under Article 28 of Bylaw No. 85 of 2006, commission is due when the sale contract is signed and registered with DLD, unless the brokerage agreement says otherwise. If the sale depends on a condition such as mortgage approval, payment waits until it is met. If negotiations fail, the broker gets nothing unless the agreement allows it.
This is general information, not legal or tax advice. Check current requirements with DLD and RERA, the FTA or a licensed adviser. Rules last verified: 4 October 2026.
Sources
Bylaw No. 85 of 2006 Regulating the Real Estate Brokers Register, Arts. 23 to 38, and Executive Council Resolution No. 6 of 2010, Art. 12, in Dubai Real Estate Legislation, DLD.
Real Estate Brokerage Practice Guide, 2nd edition (Nov 2024), DLD / RERA.
Federal Decree-Law No. 8 of 2017 on VAT, Federal Tax Authority.
Demystifying real estate commissions in Dubai (April 2023), Bayut Agent Portal (industry source for market practice only).