Buying a property is every person's dream and usually people spend their entire life savings in this process. There is currently a property boom in Dubai and where once off plan property sale Dubai was only meant for investors, now even first time home buyers are opting for this method. Off the plan property is essentially strata units and retirement village homes before the construction of the building is completed. Usually the builders and property developers include the design of the building and sketches of the final appearance in the advertising material. The sale of the property is also advertised much before it is possible to occupy it. This is how many people are buying 1 bedroom apartment for sale in Dubai.
Benefits of off plan property purchase
- Lock in price - The buyer needs to pay the current market price even if the property will be completed in the future.
- Increase in value of the property - Usually when people occupy the property after construction is completed its value has appreciated much more than what it was at the time of purchase.
- Time to save more money - If the construction of the property is not yet started you will have more time to save and you will not have to borrow too large an amount
- More affordable - If you buy early the property will be more affordable because developers are interested in securing sales to enable the development project to go ahead.
- You will have more time to shop around - Buying property off the plan gives you more time to shop around and find the best home mortgage that suits your budget.
Risks of off plan property purchase
While there are many benefits of off plan property sale Dubai there are some risks involved as well
Market viability - If the prices of real estate drop and you have paid more for the property, it may be difficult to get the finance for the full amount
Increase in interest rates - Interest rates may increase before you settle on the property
Occupancy - You will not be able to take occupancy of the 1 bedroom apartment for sale in Dubai before the construction is completed
Bankruptcy of the developer - There is always a risk that the developer goes into bankruptcy before the construction is completed. You will have to ensure that in such a case you will get your money back and also ensure what guarantees you have.
Failed expectations - You will not know anything about your neighbors till you move in and there are chances that the quality of work does not meet your expectations.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it. The author has no business relationship with any company whose stock is mentioned in this article.