Gulf News reported yesterday that people who buy property in Dubai face hidden costs when registering homes, either charged directly by the developer or passed down by a middle man, in addition to the 1 per cent fee levied by Dubai Land Department.

Some residents say "lack of clarity" over charges is undermining confidence in Dubai's property market.

"We're trying to calculate how many extra costs there are and assess the impact they are having on the property sector," said Mohammad Sultan Thani, director of development and marketing in the department.

A resident at Nakheel's International City said he paid the department's fee, as well as a 2 per cent registration administration charge to Nakheel and a further Dh2,000 service fee, which he claims was passed on to him by the building owner (an organisation that buys an entire building from a developer and sells individual units to end users).

Homeowner Haana Kurmoo said Nakheel should have charged more for the flats instead of adding costs at a later stage. "At least it would be a fairer and more honest practice."

If homeowners already holding title deeds wish to transfer their property to another party, they must produce a "no objection certificate" supplied by the developer. Nakheel says it charges Dh1,000 for this service, while Emaar Properties levies a Dh5,000 fee.

"I think Dh500 would be more appropriate for issuing a letter and registering new owners' details," said Natalie Moore.

"I am disappointed the developers are getting away with charging unreasonable amounts for what is clearly just an administration task."

Residents say developers must clarify their charges and give notice of upcoming fees well before keys are handed over.

Nakheel said in cases where a purchaser has sold residential units in a building, anyone who buys a unit must register their purchase with Nakheel and pay a 2 per cent "administration fee".