Dubai is a safety for people wishing to invest their hard-earned cash in real estate. Off-plan home investing, in particular, is extremely popular among regional buyers. The Dubai real estate market has seen a rise in interest from both domestic and foreign buyers since freehold properties became available to expats in 2002. Do you want to join them? Here are five reasons to invest in Dubai off-plan property.
REASONS FOR OFF-PLAN PROPERTY INVESTMENT IN DUBAI
Here are five reasons why you should consider buying off-plan properties in Dubai.
1. FLEXIBLE PAYMENT PLANS & LOWER PRICES
One of the most obvious advantages of investing in off-plan property for sale is that these unfinished developments are available at significantly lower prices.
When compared to ready constructions, which are valued at a higher price, attractive incentives and manageable payment plans make off-plan property investing somewhat more cheap and practical.
Off-plan houses benefit both experienced investors and new buyers by offering reduced pricing and greater financial flexibility. With new projects released on a regular basis, developers compete primarily on pricing and advantageous payment methods such as paying 50% upfront and 50% upon completion or “1% per month” payment plans. Some of these exceed 40% post-handover, offering off-plan home buyers a significant advantage.
2. INCOME FROM CAPITAL
Because the UAE has one of the world’s fastest-growing economies, real estate investments here are incredibly promising in terms of return on investment (ROI). Regardless of the “locked-in” purchase price before construction, the value of a property is certain to rise once it is done.
As a result, even if you are paying off the investment in stages according to the developer’s payment plan, you may see an increase in the market value of your property and expect considerable financial gains if you decide to sell before or after completion.
The attractiveness of the neighborhood and the area influence property market value appreciation. If the surrounding neighborhood is under development at the time of your off-plan property purchase but is gradually maturing into a possibly well-rounded community, the property’s market price will undoubtedly rise.
Off-plan property investors can potentially earn rapidly by selling the apartment before it is completed, if the project has established market favor. If you know what you’re doing, you can sell off-plan property in Dubai.
3. OFF-PLAN INVESTMENT PROVIDES HIGH RENTAL YIELDS
Rental income is a major motivator for property investment in the UAE. With an ongoing influx of expats in the nation, which shows no signs of abating, there will always be a need for housing alternatives in Dubai.
Whether you buy an off-plan flat or villa, you will most likely generate a good rental income from your real estate investment because the property is new and has all of the newest facilities.
4. DUBAI BUYER PROTECTION LAWS
While off-plan properties are risky, the RERA (Real Estate Regulatory Authority) and Dubai Land Department (DLD) in the UAE take multiple steps to safeguard buyers against delays, cancellations, or fraud.
One such law requires buyers to make off-the-plan home payments at DLD-approved institutions. Developers will be able to access funding only if the project has achieved a particular degree of completion. This will be confirmed by a project consultant. Another regulation requires developers to submit a bank guarantee for 20% of the construction money, as well as a 10% guarantee performance bond for the contractor.
Such steps boost buyers’ trust in the off-plan property market, making it a secure environment in which to invest with assurance that residences will be delivered under normal conditions. The most prevalent concern that off-plan home buyers in Dubai face is a potential delivery delay.
5. DUBAI HAS A WIDE RANGE OF OFF-PLAN PROJECTS
Buyers now have an even greater selection, ranging from Downtown Dubai to newer neighborhoods such as The Valley and Dubai Hills Estate. Do you want to know where to invest in off-plan real estate in Dubai? Take a peek at some of Dubai’s most popular off-plan projects.
THINGS TO KNOW BEFORE BUYING OFF-PLAN PROPERTY IN DUBAI
There are a few factors that every investor should bear in mind before proceeding with any off-plan investment. Here are some issues that investors may encounter while thinking about buying off-plan projects in Dubai.
BE AWARE OF DELAYS
This problem affects off-the-plan property buyers and can be a burden, particularly for those who are renting and intend to move into their new house. It’s a good idea to have a backup plan in case of delays, so you’re not caught off guard.
MANAGE EXPECTATIONS
You can buy an off-plan property in Dubai based on brochures, a showhouse, and floor plans. The quality of the building materials utilized may influence the outcome. Please do your homework on the developer you want to buy from and look at some of their other ready properties to get a sense of what the completed result will look like.
MANAGE FLUCTUATIONS
While the current environment suggests potential for financial gains and strong returns on investment in real estate, the converse might equally be true. Anything may happen between the time you buy the property and the time you get the keys. When investing in off-plan houses in Dubai, keep real estate market trends in mind and make an informed selection.
SHOULD YOU BUY AN OFF-PLAN PROPERTY IN DUBAI?
Looking for Dubai properties for sale? Everything has two sides, and buying off-the-plan Dubai residences is no exception.
Consider the following advantages and disadvantages:
DUBAI OFF-PLAN PROPERTY BENEFITS:
- Lower pricing as compared to ready-made building
- Increased financial appreciation once the property is completed
- Payment plans that are appealing and flexible
- Lower initial expenses
CONS OF OFF-PLAN PROPERTY INVESTING:
- Because the property is still under construction, there will be no immediate return.
- Buyers cannot move in or rent it out right now.
- Delays, cancellations, and poor quality all pose a danger.
- Market volatility might occur in either way.
FAQS ABOUT REASONS FOR DUBAI OFF-PLAN PROPERTY INVESTMENT
WHICH ARE THE BEST PROJECTS CURRENTLY IN DEVELOPMENT?
Are you looking to make an investment? Consider the off-plan developments in Dubai in 2023, such as Bugatti Residences and Como Residences. Alternatively, Emaar’s popular off-plan developments might be considered.
IS IT SAFE TO BUY OFF-PLAN IN DUBAI?
While completion may be delayed, it is safe to invest in off-plan developments in the emirate. Buyers are protected by authorities such as the DLD and RERA.
ARE OFF-PLAN PROPERTIES FINANCED BY BANKS?
Yes, potential buyers may obtain mortgages for buying developments like this. Banks, on the other hand, have certain standards for the types of properties they will finance.
WHAT HAPPENS IF YOU CAN’T PAY YOUR DUBAI OFF-PLAN?
If you are unable to make the payments, you may be eligible for a refund. Understanding the likelihood of being involved in a situation like this is critical. The amount, if any, will be determined by your Sales Purchase Agreement (SPA).
CAN I SELL AN OFF-PLAN PROPERTY BEFORE IT HAS BEEN COMPLETED?
You certainly can. You must contact the developer to determine the amount that must be paid before obtaining a No Objection Certificate (NOC).
WHEN WILL I BE ABLE TO SELL MY OFF-PLAN PROPERTY?
In general, a property like this can be sold when buyers have paid off 30% of the purchase price.
WHAT ARE THE SERVICE FEES FOR A DUBAI OFF-PLAN PROPERTY INVESTMENT?
This sum is determined by RERA and may differ for each project. The fees cover the annual expenditures of maintaining communal places.
WHAT ARE THE MAIN REASONS FOR INVESTING IN DUBAI OFF-PLAN PROPERTY?
The main reason is that you may expect a high return on investment in the long run. Furthermore, flexible plans eliminate the need to pay the whole sum up front.
All of these are the reasons for off-plan investing in Dubai. For a deeper understanding of the process, read our guide on buying off-plan properties in Dubai.
