Purchase Price is referring to a total cost paid for the real estate, including an initial payment, all the interim payments and the last payment but not the registration fee which is paid separately. Purchase Price is the total cost of an apartment excluding government or administrative fees.

Registration Fee is the mundane payment required to register ownership of real estate. This fee is not included in the Purchase Price and varies depending on an emirate which is important when calculating total costs of the purchase.

Installments with a deferred last payment, where a considerate part of an apartment price is paid at the end, are popular in the UAE. This allows the investors to use free money for other projects, making investments more favorable.

Inflation has direct effect om the resale value since it changes the purchasing power of money and real estate prices. For instance, there is inflation rate in the UAE for the previous years:
2018: 3.1%
2019: -2.0%
2020: -2.1%
2021: 0.2%
2022: 4.8%
Those indicators show how economic movements in a certain region can affect a real estate investor’s income, which is why we include them in our ROI calculations for the precise estimate of return on investment.

In the UAE, a Service Charge or maintenance fee is an annual cost that property owners pay for building management and maintenance of common spaces such as lobbies, elevators, swimming pools and gyms. This fee is important for maintaining quality and safety standards in residential complexes and commercial buildings, and also includes the costs of security, cleaning and other services.

The annual Service Charge is calculated by multiplying the area of the apartment by the rate set by the developer. This rate, determined before purchase, allows to estimate the annual maintenance costs that affect net rental profit and ROI.

The rental period indicates for how long the property will bring rental income. A longer lease duration can increase total income and, consequently, ROI, provided that rental rates are constant or rising.

Inflation can significantly affect rental income since it changes the cost of living and, accordingly, rental rates. In the UAE, for instance, there are following fluctuations in inflation indicators:
2018: 3.1%
2019: -2.0%
2020: -2.1%
2021: 0.2%
2022: 4.8%
Understanding these changes helps investors to adapt their pricing strategies and predict ROI based on the current economic situation and expected trends.