Benefits of Buying Off-Plan Properties in Dubai

Off Plan

8 months ago

Off-plan refers to purchasing a property before it is completed, usually while it is under construction. With the current growth rate of the real estate market and property prices skyrocketing, off-plan investment in Dubai is a compelling solution for both investors and first-time buyers to achieve long-term growth and stability in their real estate investment portfolios.

Let’s gain an insight into some of the benefits that off-plan offers.

Advantages of off-plan investment in Dubai

Investment Leverage: Off-plan real estate allows investors/buyers to leverage their resources, access higher-value properties, and raise their returns.
Tax Deductions for Investors/buyers: Investors buying off-plan for rental purposes can benefit from tax deductions by identifying deductible items within the property.
Rental Income: An off-plan property in a well-located and well-designed locality will attract higher-quality tenants, generating passive rental; income.
Exit Strategies: Off-plan investments come within flexible exit strategies, where investors/buyers can choose to either make a profit or generate ongoing income.
Premium Access: Many developers are offering exclusive access to clubs, gym memberships, and swimming pools to secure early commitments from investors/buyers.
Maintenance Cost: As off-plan properties in Dubai are under construction or newly constructed, it doesn’t require immediate maintenance/repairs, unlike resale properties. This saves a lot for investors on maintenance.
Energy Efficiency: Off-plan properties stick to strict energy efficiency standards and incorporate modern appliances and systems that save energy and lower homeowner’s electricity bills.
Government Policies: Both the government and the real estate industry have implemented policies that encourage the off-plan property market to make homes more inexpensive, accessible, and secure for buyers/investors.
Investment Strategy: Off-plan allows investors to tailor their investment strategy as investors can decide whether to keep the property for rental income, flip it for a profit once completed, or sell their share to another investor.
Below Market Value: Early investors in off-plan properties often receive discounts on their purchases, which increases the affordability and allows them to purchase the properties below the expected market value upon completion.
Reduced Competition: There are fewer buyers for under-development projects as compared to finished buildings on the open market. This can be utilized as leverage while negotiating prices and incentives.
Price Appreciation: Many studies show that the average price of a property increases up to 10-30% between the initial purchase and completion date. Off-plan investment in Dubai gives significant returns on investment as the demand increases after it is built.
Flexible Payment Plans: Developers typically offer extensive flexible payment plans for off-plan investors, usually investors pay in installments during the overall construction of the property. This approach improves the cash flow for both investors/buyers and developers.
Customization Chance: Another crucial benefit of off-plan is that it allows investors/buyers to personalize the off-plan property by customizing it. Investors/buyers can choose their specific requirements and preferences for finishes, layouts, and designs, which adds personal value to the property.
Reduced Financial Commitment: Unlike completed properties, off-plan properties normally require a lower initial investment, usually investors only need a 10-20% initial deposit. It allows investors/buyers to secure appropriate mortgage rates later, as many projects require 18-to-20 months to be fully built. This provides significant savings over the life of the mortgage and reduces the overall cost of the property for investors/buyers.
Broader Choice of Units: During the off-plan sale, investors/buyers get a wide range of units to buy from as compared to after completion. This allows investors/buyers to select the best unit according to their needs and budget, all before the prime locations and designs are taken by other investors.
Amenities: Nowadays off-plan properties come with brand-new appliances, fully furnished kitchens, bathrooms, and many more, which are not available in the case of finished properties. These new appliances offer years of worry-free living without immediate need for repair. Investors/buyers can benefit from these by living in the property or by renting it out to tenants who value these features.

In summary, buying off-plan properties in Dubai offers a wide range of benefits to both experienced investors and first-time buyers. These enhance profitability and lower the risks with the initial deposit being 10-20% of total payment.