Purchasing properties off-plan, that is unconstructed property purchased directly from a developer – or in some cases a first owner, is quite common among investors due to the many benefits it entails. Whilst there are many advantages to buying off-plan properties in Dubai, there are quite a few things you need to understand and be mindful of when taking this step. Dubai Properties has gathered a comprehensive and all-inclusive guide for off-plan property investment in Dubai, including why you may opt for an off-plan unit, and some key points to exercise caution with.
Why Invest in an Off-Plan Property?
- To Maximise Return on Investment
Buying a property off-plan means that investors are going to get the lowest and earliest possible price for a particular unit. It also means that the investor has the freedom of choice of the best units in the development, which significantly increases the chances of gaining the maximum return on investment possible.
- Sell before Completion at a Profit
With popular projects, and considering that the market has performed well, investors can sell their units even before the development has been completed at a considerable profit – making their short-term investment worthwhile.
- Lower Down Payments
Whereas down payments for completed properties are 25 percent of the property value for expats (and 20 percent for Emiratis), buying an off-plan property will save investors this hefty amount – as down payments for off-plan properties are only 10%.
Key Considerations When Buying Off-Plan Properties in Dubai
If you do decide that investing in an off-plan property is right for you, there are a few considerations you need to keep in mind to make the process as smooth as possible.
- Make Sure the Property is Registered with RERA
When buying a new property, whether as a family home or as an investment, it is essential to ensure the property’s registration in the Real Estate Regulatory Agency (RERA). To put it short, this guarantees that the property follows certain guidelines in a way that protects the homebuyer’s best interest.
- Know the Escrow Account Number and Agent Information
An escrow account is where the investor’s money is kept through the real estate transaction process. It is important to keep the account number and information about the agent on hand to be used in all transactions.
- Get to Know Some Details About the Property You Are Buying
When buying an off-plan property, it is important to know how much of the property is completed and the expected handover date. Dubai Properties Property Managers will always make this information available to you when you do decide to invest in one of its off-plan properties in Dubai.
- More Registrations with RERA
According to the Dubai law, the property developer, as well as the land on which the property is being built, must be registered with RERA.
- Approvals from DLD and RERA
In order to sell off a property, the developer must have permits and approvals from the Dubai Land Department (DLD) and RERA. Before you embark on buying any off-plan properties, make sure to ask for all the relevant documents and approvals in order to avoid any future challenges.