Our Dubai Property Expert talks more about Off Plan Properties

Our Dubai Property Expert talks more about Off Plan Properties
 
What are the finance options for an off-plan property purchase?

Most banks will only lend on completed projects however some of the larger developers do have finance support in place with certain banks up to 50% loan to value. In a competitive market the Developers provide good affordable payment plans over the period of construction and sometimes beyond completion and property handover that makes finance options less in need and therefore a further incentive for off plan purchasing.  

 
Tips on buying off-plan, how to choose where to invest?

Any prospective buyers need to engage and appoint a professional legal real estate broker who can offer correct and unbiased advice on what are the best off plan options and returns available.  This should be supported by a history of prices and also thorough knowledge of not only the location of the project you are investing in but also the neighboring area and projects. Consideration to empty land and plots should also be reviewed as potential growth or possible detriment to your selection. 

 
What are the prominent areas where off-plan properties are available?

Downtown during 2013 and 2014 witnessed the highest off plan activity. Further Emaar projects such as Mira in Reem which is close to Arabian Ranches offered a great mid cost townhouse investment.  The Hills near the established Greens and Emirates Hills communities quite rightly so sold out in one day and remains in great demand even in the resale market at 15-35% premium.  Sports City and Jumeirah Village is a great affordable option with many independent developers complimented by the mass villas launched by Nakheel.  Nakheel also launched Jumeirah Park and Al Furjan that saw a lot of activity during 2013 and has a lot of room for growth as future communities of Dubai. We saw Sobha enter the market and deliver their show homes in record time which offered some confidence into the high end market. Emaar also launched Dubai Hills which had a starting price tag of AED25M and is considered to be the new Emirates Hills.      
 

What are the pros and cons of purchasing off-plan properties?

Good money can be made from investing off plan with the right developer. Provided the launch price is not over inflated and is realistic with room for growth. You should expect to pay 25-30% cheaper than available ready projects in that area.  Access to properties you may not otherwise be able to afford due to the payment plans no 100% outlay at time of purchase.
Normally developers release product in phases over time and for increased prices which helps support current purchasers and the capital appreciation growth leading up to completion. To purchase a more upgraded product as Developers continue to improve and learn with time and experience. Provided full due diligence has been carried out as we have recommended the main disadvantage is awaiting possession of the property in order to fully utilize your investment. While Developers strive to keep to schedules and deliver on time it is not uncommon in Dubai for delays to occur and consideration to this for any off plan purchasers in any location in the world must be a factor.

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