Comprehensive guide to buying off-plan property in Dubai
- How to Buy Off-Plan Property in Dubai
- Advantages of Buying Off-Plan Property in Dubai
- Risks of Buying Off-Plan Property in Dubai
- Top Areas with Off-Plan Property in Dubai
- FAQs
Investing in off-plan property has one very obvious selling point: the price. But with lower prices often comes inflated risks. It’s all too easy and common for a buyer, especially an inexperienced one, to make some obvious mistakes. In order to ensure you make the most of your off-plan investments, we’ve compiled a list of things to consider when you plan to buy off-plan properties in Dubai.
How to Buy Off-Plan Property in Dubai
There are several things to consider when you are trying to understand the process of buying off-plan property in Dubai process. From picking the right project to considering the location and future return on investment (ROI), there’s much to consider. To help you find the perfect investment opportunity, here are some things to consider when you plan to buy off-plan properties in Dubai.
Look for the Right Property
When you’re looking to understand how to buy off-plan property in Dubai, the first step is to find the right project to invest in. Explore various projects by leading developers.
There are many property developers in Dubai, and they build various projects in different parts of the emirate. A thorough research about these developers and the areas where their projects are located will surely come in handy. There are various property-related exhibitions held in Dubai and a visit to such an event will connect you with the right developers and projects.
Research about the Developer
Before you do anything else, research the history of your development and it’s best to consider the developer’s previous projects. When you plan to buy off-plan Dubai, it’s essential to look into the developer’s reputation amongst buyers, the track record of past project handovers and the quality of the projects. Several real estate developers in Dubai offer a variety of off-plan projects.
Look for a Reliable Realtor
Selecting a trusted and experienced real estate agent or agency is crucial in your search to buy an off-plan apartment in Dubai or a villa. These professionals often have long-standing relationships with well-known property developers.
A realtor will advocate on your behalf and ensure that all contractual terms and the handover process run smoothly. They take the time to understand your preferences and budget to handpick properties that align with your needs.
It’s important to work with a certified off-plan property agent registered with both the Dubai Land Department and RERA (Real Estate Regulatory Agency) Dubai. A reputable agent will also comprehensively compare various off-plan properties in Dubai, helping you make an informed investment decision.
Assess Your Financial Situation
When you buy an off-plan property in Dubai, somewhere between 20 and 80% of the total amount is paid upfront and then the final amount is closed once the project is finished. The most common payment plan is an even 50/50 split, so you will have to be quite secure about your financial situation at the estimated time of the project’s completion. Assess all risks before you take the plunge.
Book your Dream Home
After your due diligence and assessing your financial health, it’s time to book your property off-plan. It’s one of the most crucial steps in the buying off-plan property in Dubai process. You can visit the realtor and get the deal finalised through them. Another option is to visit the developer’s sales office, where you can handpick the specific unit and reserve it.
To secure your chosen unit and ensure it’s no longer available to others, you’ll typically need to place an initial deposit, which usually falls within the range of 5% to 10% of the total property price (may vary depending on the project).
SIGN THE SPA TO BUY OFF-PLAN PROPERTY IN DUBAI
The next step is to sign the booking form and the Sales Purchase Agreement (SPA) for the unit selected. It’s worth mentioning that a dedicated real estate agent can often negotiate favourable terms on your behalf to get a good deal. Once the deal is reached, you’ll be required to pay the instalments to get the property upon completion.
Advantages of Buying Off-Plan Property in Dubai
Now that we’ve catered to the frequently asked query “how to buy off-plan property in Dubai”, it’s time to look at the advantages of investing in these properties.
Potential for Capital Growth
Whether you’re looking to purchase an apartment or have plans to buy an off-plan villa in Dubai, another aspect to consider is the project’s potential for capital growth. This point is important to consider if you intend to sell the property in future for a profit. Make sure to check the project’s location and do your homework about the return on investment and price appreciation of the property in that location.
Make sure you have all the information about the quality of the project as well. Sure, the brochure and the website look stunning, but can you guarantee the finished product will look great?
This is where researching the quality and history of your developer comes into play for price appreciation in the future. Ensure you’re investing your money with developers who have a good reputation.
Once you’ve combed through the above issues, you should be able to accurately tell if you’re in a position to buy property off-plan in Dubai.
Option to Sell Before Project Completion
The Dubai off-plan property’s contract can often be sold before the project is completed. Provided the market is performing well and the project is popular, this will lead to quite a profit for the seller.
There are several aspects to consider when it comes to the process of selling off-plan property in Dubai. The developer might have terms and conditions that prohibit you from selling the property to another before completion. Do check with the realtor and the developer for more details.
It Comes with Buyer Protection
Additionally, the UAE’s Real Estate Regulatory Agency RERA established regulations that have added more protection for buyers against many illicit activities and sudden plan changes from developments (like long delays or cancellations).
Risks to Consider When You Plan to Buy Off-Plan Property in Dubai
With all the benefits that off-plan properties offer, there are some downsides that are worth considering. Let’s look at some risks of buying off-plan property in Dubai.
The Project Could be Delayed
The most commonly cited problem by those buying off-plan properties in Dubai is that the project may be delayed. In many cases, there have been delays in handovers for almost a year or, in some cases, more than a year after the quoted handover date. Some projects have even been cancelled entirely! So, hope for the best, but don’t be surprised if your project is delayed somewhat.
Change in Market Conditions
Another disadvantage of getting an off-plan property for sale in Dubai is the sudden change in market conditions. During the COVID-19 pandemic, the property market witnessed a downtrend in property prices, which led to a decline in the real estate’s value. In most cases, the market tends to rise after the conditions improve, but loss of value is a risk you must consider before investing in an off-plan project.
A Portion of the Sale Price must be Paid before Selling
While buyers can sell their off-plan property, there might be limitations if you’re considering selling your off-plan property before it’s complete. Many developers in Dubai require buyers to pay off a specific portion of their off-plan property purchase before they allow resale. So, it’s a wise move to touch base with the developer and inquire about the minimum amount you must pay off before selling your off-plan unit.
Takes Time to Give Good Returns
An off-plan property may take a long time before it is able to give a good return on your investment. If you’re looking for short-term profits, this might not be your right investment.
Top Areas to Buy Off Plan Property in Dubai
There are several areas that offer affordable as well as luxury off-plan projects in Dubai. If we consider Bayut’s sales market report for H1 2023, there were 60,927 residential property sales transactions (ready and off-plan) worth AED 179.3B recorded during H1 2023 as per the data available at Dubai Land Department. Using the Dubai Transactions feature on Bayut, here’s how the most popular areas contributed to these numbers.
JVC
- Stonehenge Residences by Segrex
- Levanto by ORO24
- Westwood Grande by Imtiaz
- Elitz by Danube Properties
- Maimoon Gardens by Fakhruddin Properties
AL FURJAN
- Murooj Al Furjan West by Nakheel
- Millennium Talia Residences by Deyaar
- Pearlz by Danube Properties
- Azizi Amber by Azizi Development
ARJAN
- Vincitore Dolce Vita by Vincitore Realty
- Vincitore Volare by Vincitore Realty
- Opalz by Danube Properties
- Kyoto by ORO24 Developments
- Arbor View by Ellington Properties
Dubai Hills Estate
- 399 Hills Park by National Properties
- Elvira by Emaar Properties
- Address Villas Hillcrest by Emaar Properties
- Golf Grand by Emaar Properties
- Hills Park by Emaar Properties
Dubai Creek Harbour
- Rosewater Creek Beach by Emaar Properties
- Creek Edge by Emaar Properties
- Palace Residences North by Emaar Properties
- Lotus Creek Beach by Emaar Properties
- Creek Waters by Emaar Properties
Besides the aforementioned areas and projects, some other options include Dubai South and DAMAC Hills 2.
Off-Plan Projects by Emaar
Emaar is a premier real estate developer with several projects under its belt. There are some impressive off-plan projects by Emaar in Dubai that you must explore. These projects include Arabian Ranches 3, Emaar South, Emaar Beachfront, Palmeira the Oasis by Emaar and Fairway Villas 2.
FAQs about Buying Off-Plan Property in Dubai
What does it mean to buy off-plan property in Dubai?
Buying off-plan property in Dubai means purchasing a property that is still under construction or has not yet been built. These properties are available at a discount and offer a good potential for a price hike.
Can non-residents buy off-plan properties in Dubai?
Yes, non-residents can buy off-plan properties in Dubai. There are no restrictions on property ownership for expatriates in freehold areas in Dubai. However, ownership regulations may vary depending on the location and type of property in Dubai.
What documents are required to buy off-plan property in Dubai?
Here’s a general list of documents you might be required to submit if you have plans to buy off-plan property in Dubai. Please keep in mind that this list is not exhaustive, and you may be required to submit other documents for the actual purchase.
- Emirates ID (Copy)
- Passport (Copy)
- Sales and Purchase Agreement (SPA)
- Reservation form
- Mortgage contract (If applicable)
This concludes our guide to buying off-plan property in Dubai. There could not be a more opportune time to invest in one of the many property projects currently on sale in Dubai. These properties tend to increase their value in the long term and offer fruitful rental yields.
Exactly right, the most commonly cited problem by those buying off-plan properties is that the project may be delayed.