Advantages of Buying Off Plan Properties in Dubai
Buying off-plan property, which refers to purchasing units at the project launch phase or under construction, has always been a popular approach of investment in Dubai. This way offers several benefits that appeal to worldwide buyers. Throughout this article we dive deeper in the advantages of purchasing off-plan properties in Dubai. It will hopefully help you determine if this method is the best solution for you as an investor.
1. Advantages of Buying Off Plan Always Start with Lower Cost and Payment Plans
Early Bird Catches the Worm
As one of the first and well known benefits of buying off-plan property in Dubai is the lower acquisition cost. Generally, developers offer properties at a lower initial price at the early stages to attract investors and confirm the demand. These lowered initial prices represent a fantastic way to save compared to same type ready units and for investors to save few percentages on additional fees compared to ready units.
Flexible Payment Plans
Developers frequently offer attractive payment plans for off-plan properties. These plans typically spread payments over the construction period, reducing the financial burden on buyers. For instance, buyers might pay a small down payment initially, usually 10 or 20%, followed by installments until the property is completed. Some developers even offer what is known as post handover payment plans, allowing buyers to pay off the balance of property price even after handover. This flexibility makes it easier for investors to manage their finances and invest in real estate without the need for immediate full payment.
2. Investors Benefit from High Capital Appreciation by Buying Off Plan
Increased Property Value
Investing in off-plan properties leads to increase in price on handover, this ensures capital appreciation for investors. With the movement of construction the price usually follows. As a buyer you can sell your property even while it is still under construction. Generally the highest capital appreciation is achieved at the time of handover, when the project is ready.
Market Growth
Dubai’s real estate market historically had very strong growth. It is driven by government initiatives and continuous development of top notch properties as the city is still growing . Off-plan properties in new developing areas or prime locations can experience incredible appreciation rates as historically proven. They are the main target for a lot of worldwide savvy investors.
3. Massive Advantage of Buying Off Plan is Understanding the Full Project
Seeing the Full Picture
Another advantage of buying off-plan properties in Dubai is understanding the project in full. This is a very important factor for making a well informed decision. Unfortunately, it is often overlooked by the inexperienced buyers.
Targeted Units
Furthermore, now once you understand the project in full, narrowing down on units of interest is easier. Target the orientation, view, specific unit type, floor, layout, scarcest units or a combination of it. Entering early and purchasing a property at the launch gives you the highest chance to secure the most desirable units in the project.
4. Modern Amenities and Design
Latest Standards and Technologies
Off plan properties are featuring latest gadgets and are designed using the latest architectural design, engineering and construction standards. Buyers benefit from modern amenities, energy efficient systems and contemporary design that is now lacking in older developments. This enhances the overall experience of living and contributes to property appreciation ​​in the future.
Comprehensive Community Development
Many off plan projects in Dubai are part of a larger master-planned community. These developments include facilities like parks, schools, shopping malls, recreational facilities and often pools or water features. Investing in these master communities enables full understanding of the area before it is developed. Also, it guarantees ease of access to variety of every day facilities in the community improving the property value and quality of life for residents.
5. Attractive Investment Opportunities
Higher Rental Yields
New properties achieve higher rental rates compared to older or renovated ones. Investing in emerging areas or prime locations initially leads to strong demand for rentals after completion. This translates into higher rental income, making off plan properties more attractive to investors
Strategic Locations
Developers typically choose suitable locations for off plan projects, taking into account future development possibilities and infrastructure. Early investment in these areas can deliver huge returns, as surrounding areas develop and push the property value.
6. Financial Security and Legal Protections
Escrow Accounts
Dubai has carried out strict laws and regulations to ensure safety of off-plan property buyers. It is mandatory for developers to have escrow accounts in order to receive buyer’s funds. Buyers are making installment payments to these accounts and developers can receive it partially only after completing certain stages of construction. These accounts are also overseen by Dubai Land Department, making sure that customers’ money is used accurately while reducing the risk of delays or cancellations.
Legal Protection
Dubai Land Department, a government facility, is in charge of all real estate related matters in Dubai. The Real Estate Regulatory Agency also known as RERA is a part of DLD that oversees the actual marketplace in Dubai. This ensures transparency and compliance with policies in place.
7. Benefit from Buying Off Plan with Attractive Developer Incentives
Promotions and Discounts
To improve sales, developers frequently provide diverse promotions and incentives for off-plan projects. These can include furniture packages, discounts, fee waivers such as DLD registration costs, post handover payment plans etc. That type of incentives make off plan properties even more profitable and lucrative to investors.
Guaranteed Returns
Some developers offer guaranteed rental returns for a prolonged period, like 3 years, after the handover of keys. Sometimes along with a guaranteed return, example 8% per year, you can also get a service charge waiver making those 8% returns NET to you. This is an excellent option for those more skeptical and investors who want to know they can definitely count on this income stream.
8. Potential for Bulk Buying and Resale
Bulk Purchase Benefits
Investors looking to buy in bulk, more that 1 unit, can often achieve better deals and get discounts through negotiations. Buying in bulk can result in capital savings and increase the overall return on investment as well as increase your chance of getting the best units in the project.
Early Resale Opportunities
Buying assets as off plan allows investors to take advantage of resale opportunities. As the project progresses and demand increases, investors can sell their units for a profit before the property is completed. This approach can offer significant overall returns, and very high return on equity, especially in emerging markets such as Dubai.
Seize the Benefits of Buying Off Plan Property in Dubai
Investing in off plan property in Dubai offers numerous advantages. Some as mentioned lower prices and acquisition cost, flexible payment plans, capital appreciation potential, latest design and world-class amenities, along with highest rental yields.
Continuously growing real estate market in Dubai presents exciting opportunities. They are available across the city at variety of entry prices and payment methods, making them available for everyone. The benefits of buying an off plan property in Dubai also come with a strong legal protection ensuring the seamless process. Investors can maximize their returns by careful consideration and working with an expert.
Frequently Asked Questions from Advantages of Buying Off Plan Properties in Dubai:
Frequently Asked Questions from Advantages of Buying Off Plan Properties in Dubai:
Yes, especially with purchasing off-plan properties upfront in Dubai you can get a more affordable deal along with many other benefits!
There are multiple benefits. From flexible payment options, to more affordable prices compared to completed projects, lower initial investment costs, and many more.
Absolutely, the main requirement for selling off-plan property in Dubai is paying 30% to 40% of the total amount of the property.
Yes! Investing in off-plan property in Dubai is an excellent long-term insvestment!
Read in detail about Factors to Consider When Investing here!
Yes! Residents and non-residents can get a mortgage in order to invest in off-plan Dubai properties.
Off-plan properties in Dubai are properties that are under construction. Off-plan property buyers get many great benefits from their purchase!
Yes! You can buy a freehold property and have 100% ownership forever, or you can invest in leashold area, timeline of owning a leasehold property in Dubai is usually 99 years.
Yes, you can buy a property in Dubai and rent it out!
Read in detail about Process of Buying Property in Dubai here!
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