5 Factors to Consider in Buying an Off-Plan Property in Dubai

Properties are excellent investments as they are passive income generators. Although they cost a lot up-front, they only take a few years to recover as they are easy to market to people needing a place to live or use as commercial space. For example, people invest in Dubai for many reasons—among all are off-plan properties or projects planned and registered in the Dubai Land Department having an escrow bank account. But what should people consider in buying an off-plan property in Dubai? Here are some ideas.

1. Location

People prefer locations that are easily accessible. It is best if the area is close to the city center, Dubai Marina, or other prominent sites outside the city center. Properties that are not easily accessible are undesirable since they tend to lose value.

Even near, they usually have many setbacks due to the enormous traffic. For example, people avoid properties located in the emirate of Sharjah as this emirate is far from the city. Pedestrians do not cross the Dubai-Abu Dhabi highway through Sharjah as this is a hazardous location.

2. Surrounding Establishments

People prefer properties built around helpful establishments. It is better than properties in locations where the established institutions are relatively close. For example, finding a property near schools or bus stops is ideal.

People also prefer locations close to malls, supermarkets, hospitals, and parks. They also like places close to areas where they can use public transportation, such as the Metro. Choose a location where surrounding establishments provide convenience.

3. Cost and Payment Plan

People prefer to know the cost to know how much the monthly payment will be. They also like paying for their properties in installments. The most common plans are the 20/20, the 20/10, and the 10/10. The 20/20 plan stipulates that the investor will pay 20% as a down payment and the remaining 80% as a mortgage.

Meanwhile, the 20/10 plan means that the investor will make a 20% down payment and pay 10% monthly. The 10/10 plan means that the investor will pay 10% as a down payment and make the monthly payments. The buyer must be able to pay the monthly installments.

4. Completion and Handover Date

People prefer to know when the contractors completed and handed over the project because they want to see how much time it took for the project to finish, as this shows good management. However, if the contractors fail to finish the project in time due to a lack of funds, the property price usually falls by about 10% to 15%. People prefer properties where the completion stays on track during the project's duration.

5. Certificate of Registration

The Dubai Land Department issues the certificate of registration used to confirm that the off-plan property is registered with the department. The department must give the certificate of registration to the emirate of Dubai because this emirate is the only emirate with the right to issue the certificate of registration.

Some people use the certificate of registration for the Abu Dhabi Properties Registration Centre to have a certificate of registration. But this is illegal as the Abu Dhabi Properties Registration Centre issues a document similar to the certificate of registration.

Conclusion

People buy off-plan properties because they want to take advantage of the appreciation of property prices. The off-plan properties attract many people as they are relatively cheaper than buying the previously owned properties. But buying off-plan property is different from buying a previously owned property. Therefore, people should know how to purchase off-plan properties and what to consider in buying off-plan properties in Dubai.

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