Reservation fee / booking deposit
A reservation fee or booking deposit is the first payment made to a developer to take a specific off-plan unit off the market while the contract is prepared.
What Reservation fee / booking deposit means for a buyer
To secure an off-plan unit you sign a reservation or booking form and pay a deposit. Developers structure this differently: some take the full first instalment of the payment plan at once, often 10% to 20% of the price, while others accept a smaller fixed sum to hold the unit for a few days until the balance of the first instalment arrives. The 4% DLD fee is normally due at the same stage.
The form records the unit, the price and the payment plan, and gives a deadline, commonly within a month, for signing the SPA. It also states what happens if you do not proceed, and this is the clause to read. Many forms let the developer keep some or all of the deposit if you withdraw or miss the SPA deadline.
Three checks before paying:
- The money goes to the project's escrow account, not to an agent or a general company account.
- The project is registered, which you can confirm on Dubai REST or, in Abu Dhabi, DARI.
- You have seen a draft SPA, or the form says the deposit is refundable if you reject its terms.
A reservation fee differs from an EOI, which is paid before a launch and does not secure a particular unit. On a resale, the equivalent is the 10% deposit cheque lodged with the broker under Form F.
Related terms
Guides that use this term
Where Reservation fee / booking deposit comes up in practice, with the costs, rules and steps around it.
Questions about the buying process?
An adviser can explain how this applies to the property you're considering.
- Current price list and availability, direct from the developer
- No fee to you on off-plan purchases: the developer pays us
- One salaried adviser, not on commission, from first call to handover
