Why Invest in Off-Plan Properties in Dubai

Dubai’s real estate landscape is rich with sophisticated residential communities and tasteful properties, located in prime areas where international investors meet.

Off-plan property investment is a common investment plan among buyers for a multitude of reasons, as further explained in this article. Continue reading to explore the specifics of off-plan property investments and the benefits of buying an off-plan property in Dubai.

Off-Plan Properties vs. Ready Properties

Off-plan properties are those still under construction or in the planning phase, while ready properties are ready for immediate occupancy since their construction is complete. 

It is worth noting that the off-plan option is favoured when buying real estate for investment purposes rather than personal use. That is due to the various advantages of investing in off-plan properties in Dubai, including lower prices, flexible payment plans, and other benefits shown below.

Benefits of Buying Off-Plan Property in Dubai

• Higher Affordability and Flexible Payment Plans

There are numerous off-plan properties in a variety of residential areas in Dubai, including affordable neighbourhoods and luxurious, high-end areas. Regardless, investors will find off-plan properties to be more affordable across all markets compared to ready properties. This is due to the investor’s payments contributing to the construction of the property.

Additionally, real estate developers offer practical and financially flexible payment plans for off-plan properties, boasting the competitiveness of the market and providing a plethora of options for experienced buyers and first-time investors.  

Some of the common payment plans for off-plan property investments are as follows:

• The 80/20 Payment Plan: 80% of the property’s price must be paid during the construction phase, while the remaining is due at the property’s handover.
  
• The 60/40 Payment Plan: 60% of the price is to be paid during construction and 20% of it is due at the handover.
  
• The 50/50 Payment Plan: 50% upfront and 50% upon completion.

This flexibility appeals to all budgets and financial plans, making off-plan property investments an attractive and practical investment option.

• Capital Gains and Appreciation

Thanks to Dubai’s thriving economy, the Emirate’s real estate market is highly stable and ever-growing, and it promises high capital gains and profitable appreciation, drawing in real estate investors all year round. Considering these factors, investing in an off-plan property in Dubai is lucrative and incredibly safe in terms of risk management.

Off-plan property investments in Dubai guarantee a high return on investment (ROI); the property’s value will appreciate during the construction phase, which is ideal for investors who want to sell the apartment or villa or rent it out before completion or upon handover since doing so offers quick capital gains– a desirable outcome for many investors.

Another feasible scenario to achieve great capital gain is holding on to the property for some time, during which its value will appreciate even more, allowing investors to sell the property for a higher price than the purchase price.

Investors can depend on the natural value increase, a persistent real estate trend in the market, to gain elevated capital gains, especially when selling an off-plan property located in a well-connected area with a growing residential population.

The potential for capital gains in a short time period, coupled with the flexible payment plans, presents off-plan property investments as a prosperous investment option.

• High Rental Yields

As mentioned above, some investors buy properties for investment purposes rather than personal use. This can manifest in re-selling the off-plan property before completion, immediately after handover, or after keeping it for a while.

Another advantageous real estate investment plan is renting out the property. In the case of an off-plan property, the owner can rent it out shortly after handover to make use of the apartment or villa’s newness. With the constant influx of foreign individuals and families into the Emirate, investors can gain a great rental income regularly, utilising the high demand in the property market.

• Laws and Regulations for Protection

When considering the risks involved in off-plan property investments, some investors hesitate to follow through with their plans because of doubts surrounding delays in the property’s handover, cancellation of the project, or fraud.

Therefore, plenty of laws and regulations are implemented to protect investors’ interests, especially through RERA (Real Estate Regulatory Authority) and the Dubai Land Department (DLD). Some of these include:

• All payments for off-plan property investments must be done via banks approved by the DLD.
• Real estate developers can only access funds under the condition that the project construction reaches a certain stage (80%, for example).
• If the project is not initiated for reasons beyond the developer’s control, all payments made by the buyer must be refunded.

Do you want to invest in an off-plan property in Dubai? Below are some areas with the top off-plan residential properties.

Off-Plan Properties in Dubai: Where to Find Them

New off-plan projects are constantly entering the market, so it is recommended to consult an expert to guide you through your search. However, here are some renowned areas in Dubai that are distinct for their wide range of off-plan properties:

• Mohammed Bin Rashid City (MBR City)

Located amidst Sheikh Mohammed Bin Zayed Road (E311), Sheikh Zayed Road (E11), and Al Khail Road (E44), it offers various off-plan villas and apartments with futuristic and elegant designs, in addition to excellent amenities.

• Al Furjan

It is only 5 minutes away from Sheikh Muhammed Bin Zayed Road, and it hosts an impressive range of off-plan apartments, villas, and townhouses. Coupled with outstanding amenities and proximity to key destinations, it is an appealing option to many.

• Jumeirah Village Circle

This residential destination is gaining traction from investors thanks to its strategic location, exceptional facilities, and affordable yet elegant off-plan properties. It is the ideal option for families since it is located near schools, nurseries, and healthcare centres. Not only that, but it is in proximity to various entertainment outlets, malls, and eateries.

Discover LEOS Developments in Dubai today, and explore LEOS apartments in Jumeirah Village Circle and other prime locations in the Emirate. They are unique for their contemporary and captivating designs and world-class facilities, ensuring a lifestyle of elegance, luxury, and convenience.