Buying “Off-Plan” means that you are buying property before it is built. It’s a hugely popular option in Dubai, as construction projects are springing up all over the Emirate, and it is particularly popular with international investors.
Off-Plan means that you have the ability to purchase at a lower price with a potentially significant return on your investment. There are a number of payment schemes available to off-plan buyers and investors, often with a deposit as low as 10%.
The risk involved in buying Off Plan in Dubai has been significantly reduced over the last few years with the introduction of a law that protects investors
If you contact our team at Espace Real Estate Dubai, we can help you understand what payment options are available and which are best for you.
Why Developers Sell Off-Plan
In order to limit their financial risk, and partly to fund the project, all developers will want to sell units off-plan. The best developers know that they have to market their future properties to you attractively. Therefore, they will create artistic impressions and marketing collateral that gives you an idea of what the property will look like, where it will be, and what facilities will be nearby.
Naturally, they will offer a lower price because you cannot see the property yet. This, essentially, is why Off-Plan is seen as a fantastic investment opportunity. We can help you find those investment opportunities.
We can also help you undergo due diligence – and this is an essential part of buying off-plan. You need to make sure that the property you are buying is being built by a reputable developer, in a good location, with good facilities.
These are prime considerations. At Espace, we ensure that the development is a prime investment. Of course, you don’t want to invest in an area or a building that might not be completed – nor do you want to invest in an area that doesn’t have potential. Therefore, look at the development plans as part of your due diligence and consider:
Thanks to the famous “Law Number 13”, there is increased transparency in the development of Dubai property.
The law also means that if you are purchasing a property Off-Plan, you will make your payments to the Land Department rather than directly to the developer, as was the case in the past. Developers will only be allowed access to your funds when phases of construction are completed and verified by the department.
This law was welcomed by the Real Estate community because it allowed greater regulation of the Off-Plan market, and gives investors greater assurance that their investment is safe.
- What is the developer’s financial performance?
- What is the developer’s record on completing projects?
- Does the developer have a good reputation for finishing on time and to specification?
- What facilities are available? Schools? Shopping malls?
- What are the transport links?
- What developments are nearby and how close is it to key parts of Dubai, e.g. airport, Financial Centre, etc.
Making a Return on your Off-Plan Investment
It’s your decision what you do with your Off-Plan purchase – you can wait until the property is complete and sell, if there is the potential for profit, or you can keep it for several years.
If you buy an Off-Plan unit at an early phase of development, you can often expect to get the lowest price. The more properties get snapped up, the higher the Off-Plan prices tend to get. Therefore, early investors can often get the best prices, as well as the best positions on the development.
As the development continues, you’ll find that there are more reasons for investors to buy. For instance, show homes will be built, and press releases might attract the attention of investors.
You will need to sit down with an expert and discuss the potential yield. We can help you understand the rental market if you are planning to let your property, and give you an estimation of what sort of yield you can expect.
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