Payment plans, escrow and the fees nobody mentions

How the plans are structured

• →Construction-linked splits — 80/20, 60/40 and 50/50 dominate the current launch cycle, with 60/40 the most common: installments released against verified building milestones (or fixed calendar dates), the balance at handover.
• →Post-handover plans — typically 40–60% during construction, the rest in interest-free monthly or quarterly installments for 2–5 years after you get the keys.
• →Booking — down payments run 5–20%. Big launches often start with an EOI deposit (commonly AED 20k–100k) credited to your price, with the sale agreement signed within a few weeks.

Where your money actually goes: the escrow laws

In both emirates your installments do not go to the developer’s account — by law they go into a project-specific, regulator-supervised escrow account.

• →Dubai (Law No. 8 of 2007): withdrawals only against construction progress verified by an independent engineer. After completion, 5% of the escrow stays locked for a full year after units are registered to buyers — a defects fund.
• →Abu Dhabi (Law No. 3 of 2015, tightened by Law No. 2 of 2025): no withdrawals at all until 20% of construction is verified complete — unless the developer posts a 20% bank guarantee and has a 4-year, 3-project on-time track record. Escrow money can no longer pay for the developer’s land or broker commissions — construction costs only.

Registration: the 4% (or 2%) you pay up front

• →Dubai: every off-plan sale must be Oqood-registered; the fee is 4% of price at purchase. Paid once — when your Oqood converts to a title deed at handover there is no second 4%, just small fixed fees.
• →Abu Dhabi: off-plan registration through DARI at 2% of price (formally split buyer/seller unless your contract says otherwise) plus a small service fee.

Financing: the 50% rule

The UAE Central Bank caps off-plan mortgages at 50% loan-to-value for everyone — any nationality, any price. Compare that to 15–20% down on a completed first home, and you see why most off-plan buyers self-fund the construction installments and mortgage only the handover balance. In practice banks finance approved developers only and often start disbursing once construction passes roughly 40–50%.

If life happens: default and resale

• →Missing installments (Dubai): the process is statutory, not contractual — DLD serves a 30-day notice; uncured, the developer may terminate and retain up to 25% of unit value below 60% completion, up to 40% above it, refunding the rest within a year (or 60 days after reselling the unit).
• →Abu Dhabi (2025 rules): a graduated retention schedule from ~10% in early stages to a 40% maximum near completion — with refunds required within 15 working days.
• →Selling before handover: legal and common, but you need the developer’s NOC — typically granted once 30–40% is paid, with an admin fee — before the land department will transfer the registration.

The handover bill nobody budgets

• →Service charges start at handover, not when your post-handover plan ends — and the first year is usually pro-rated and collected upfront with the keys.
• →Utility deposits: DEWA AED 2,000 (apartment) / 4,000 (villa) in Dubai; ADDC in Abu Dhabi; district-cooling deposits commonly AED 1,500–3,000 in chilled-water communities.
• →Title-deed issuance fees when the interim registration converts — small, but on the same invoice pile.

Questions buyers ask