Rent or mortgage: the monthly question
Many tenants in Dubai pay rent that is close to, or more than, what a mortgage on the same home would cost. This calculator puts the two side by side. On the owning side it adds everything a tenant does not pay: the mortgage payment, service charges and maintenance.
Not all of a mortgage payment is a cost
Rent is gone once you pay it. A mortgage payment is part interest, which is a real cost, and part principal, which pays down the loan and builds equity you keep. Early in the loan most of the payment is interest, and the share going to principal grows every year.
So the calculator shows two owning figures. The full monthly outgoing tells you whether you can afford it. The true cost, which is interest plus running costs, tells you what owning actually costs you compared with rent.
Worked example
Renting a two bedroom apartment at AED 110,000 a year, or buying it for AED 1,600,000 with 20% down at 3.9% over 25 years, with AED 16,000 in service charges and AED 3,000 maintenance a year:
| Monthly | Amount |
|---|---|
| Rent | AED 9,167 |
| Mortgage payment | AED 6,686 |
| Service charges and maintenance | AED 1,583 |
| Total owning outgoing | AED 8,269 |
| Of which builds equity (year one) | AED 2,571 |
| Mortgage cheaper than rent by | AED 897 |
Over five years with rent rising 4% a year, the tenant pays about AED 596,000 in rent. The owner pays about AED 496,000 in mortgage payments and charges, of which about AED 167,000 has paid down the loan. To get there, the buyer needs about AED 426,000 upfront for the deposit and fees.
What this leaves out
Changes in property value and the cost of selling are not included here, and the mortgage rate is held steady even though most UAE fixed rates last one to five years. For the long-term picture, use the Rent vs Buy calculator alongside this one.
Guide How Dubai rent increases work The RERA index brackets, the 90 day notice rule, and what to do when an increase looks wrong.Frequently asked questions
Is a mortgage cheaper than rent in Dubai?
Often, month to month. With 20% down and rates around 4%, the mortgage payment plus service charges on many Dubai apartments is close to or below the rent on the same home. The catch is the upfront cash: the deposit plus around 7% of the price in fees.
Why does the calculator split the mortgage payment?
Part of every payment is interest, which is a cost like rent. The rest repays the loan, which you get back as equity when you sell. Comparing rent with interest and running costs shows what owning really costs each month.
What costs does an owner pay that a tenant does not?
Service charges, maintenance and repairs, and the one-off buying fees such as the 4% DLD fee and agency commission. Tenants pay DEWA and the housing fee either way, so those are left out of both sides.
Does this tell me whether to buy?
It answers the monthly cash flow question. For the full picture over the years you plan to stay, including price growth and selling costs, use the Rent vs Buy calculator as well.