New Construction Projects in Dubai
Dubai is a hub for real estate investment in the region and for good reasons. Its avant-garde architecture and unique projects never fail to amaze. Add to that a large portfolio of world-class developers, stable economy, and supportive government policies, and it’s easy to see why investors flock to Dubai from all over the globe.
Not only that, but the wide variety of properties is astounding. Whether you’re looking for a spacious Dubai off plan villa or townhouse, or a luxurious penthouse or apartment, you will find it.
Because of the high demand for properties for sale in Dubai, new projects are constantly springing up. Many new developments are off-plan or sold on a primary basis.
What is an Off-Plan Property?
An off-plan property is one that is still under construction or yet to be built. To buy an off-plan property in Dubai, the buyer signs a contract with the builders prior to the completion of the project.
This form of buying real estate is quite popular in different parts of the world and is gaining traction in Dubai. This is because the city is transparent in its transactions and strictly adheres to rules, which inspires trust in buyers. Thus, buying a Dubai off plan property is easier than in other cities.
Why Should You Buy Off-Plan Developments in Dubai?
Here are some top reasons people buy off-plan properties in Dubai:
Perhaps the most attractive aspect of buying off-plan developments in Dubai is the lack of taxes, which attracts investors from all over the world.
A major reason people gravitate towards buying off-plan properties in Dubai is their competitive prices. These are usually cheaper than secondary properties since they’re still not completed, and developers try to attract investors with discounted prices to secure financing for constructing their projects.
Off-plan developments in Dubai are usually built with cutting-edge technology and features, making it more attractive to potential buyers.
With Dubai’s continuous growth, property values tend to increase over time, increasing your capital gains in the long run.
Primary Properties:
These are new properties directly sold by the developer and have not been previously owned, so you would be the first buyer. Primary properties include new launches and on-going projects.
They can be:
Off-plan: off-plan primary properties are still under construction, with a promised delivery date by the developer.
Ready properties: fully constructed properties that are ready to be occupied.
What’s the Difference Between Primary and Secondary Properties?
Unlike primary, a secondary property is one that was previously owned and is sold by the owner (not the developer) for profit.
Secondary properties are already rented out or occupied by the owner, and they’re on the market for rental or sub-sale purposes.
Furthermore, these properties are usually found in well-established neighbourhoods, while primary properties are often in newer neighbourhoods. But sometimes an owner of an off-plan property decides to sell it, which is why there are some secondary off-plan properties in communities that have yet to flourish.
Perks of Buying a Primary Property:
One of the biggest advantages of buying a primary project is that the price might be much cheaper than the market price. This is because developers often provide discounts and deals that let you get a lot more bang for your buck.
Some developers propose handling some legal costs like the 4% Dubai Land Department fee, making a primary project even more financially attractive. Plus, you can get flexible payment plans for many primary projects.
The lower purchase price and developer promotions drive a healthy capital appreciation on primary projects even before they’re fully constructed.
Since these units are brand new, they need little to no renovation costs.
Top Developers with Upcoming Projects in Dubai
The abundance of world-class developers in Dubai is part of what attracts investors to the emirate. Working with reputable names inspires trust in the quality and timely delivery of projects. Some of the best developers with off-plan developments in Dubai include:
Emaar Properties
Emaar is a real estate giant in Dubai known for its innovative projects and iconic developments like Burj Khalifa, Dubai Marina, and Arabian Ranches. Some of the Emaar off-plan projects in Dubai as of 2023 include Bayview and Seapoint in Emaar Beachfront, Palmiera in The Oasis, and Parkside Views in Dubai Hills Estate.
Nakheel
Nakheel is one of the most reputed developers in Dubai. They’re the mastermind behind Palm Jumeirah and many other communities like Jumeirah Village Circle and Jumeirah Lake Towers (JLT). Nakheel new projects include Palm Beach Towers 3 in Palm Jumeirah, Jebel Ali Village, and Tilal Al Furjan.
DAMAC Properties
DAMAC is a key player in Dubai’s real estate market and is known for popular projects like DAMAC Hills and DAMAC Hills 2. DAMAC new projects include Volta in Downtown Dubai, Skycrest Collection in Dubai Harbour, and DAMAC Bay 2.
Meraas
Meraas is renowned for its prestigious developments like Bluewaters Island, City Walk, and Bulgari Resort & Residences and has various upcoming projects in Dubai. Meraas new projects include Bluewaters Residences, Design Quarter in D3, and Lamaa in Madinat Jumeirah.
Sobha Realty
Sobha Realty is an international luxury real estate developer primarily working on residential properties. They are known for the upscale community Sobha Hartland. New projects in Dubai by Sobha Realty include Sobha Verde in JLT, Sobha One and Waves Opulence in Sobha Hartland.
Ultimately, you have plenty of developers and locations to choose from if you're looking for Dubai off plan properties.
Is It Safe To Buy Off-Plan In Dubai?
It is safe to buy off plan property in Dubai since agencies like RERA and DLD protect buyers even if delays happen.
What Are The Off-Plan Payment Plans In Dubai?
There are multiple off plan payment plans in Dubai such as:
80/20 payment plan
Perhaps the most popular option among people buying off plan developments in Dubai, the 80/20 payment plan requires buyers to pay 80% of the price of the property during construction, and 20% once it’s handed over.
There are two ways to pay the 80% pre-handover amount:
Construction-linked payment plan: This payment method depends on the milestones of the construction. Buyers can pay as the property reaches certain stages of development, with the construction’s progress determining the percentage of the installments. The benefit of this method is transparency as it aligns payments with the development stages of the property.
Time-linked payment plan: Some developers let buyers pay on fixed dates, scheduling payments at regular intervals until the property is handed over. The most common interval is every 4 months. The perks of this payment method is that it offers predictability and allows buyers to plan their finances.
60/40 Payment Plan
The 60/40 off-plan payment plan lets buyers pay 60% of the property’s price during the construction phase, and 40% upon handover. This is a more balanced distribution of funds during the project’s development.
50/50 Payment Plan
Perhaps the most balanced off-plan payment plan, this method lets buyers pay 50% of the property’s value during construction, and the remaining 50% at handover.
Deferred Payment Plan
With this payment plan, you can defer a part of the Dubai off plan property’s price to a later date, usually after its completion. This payment plan gives you more flexibility to manage your finances.
Down Payment
Down payment is the first step in buying an off-plan property in Dubai. This amount varies depending on the developer and the payment plan you chose, though down payments usually range from 10% to 20% of the total value of the property. For certain off plan projects in Dubai or upscale properties, developers may request bigger down payments.
What Happens If You Can’t Pay For Your Off Plan Property In Dubai?
Legal requirements for buying an off plan property in Dubai
A buyer who wants to purchase an off-plan property must sign a legally binding document known as the Sales Purchase Agreement (SPA) with the developer. This legal agreement contains information about the terms and conditions of the purchase, such as the payment plan, completion date, and other important facts. Buyers are expected to make all of these payments within the time frame agreed upon.
In Dubai, the sale of off-plan properties is governed by Law No. 13 of 2008 Regulating the Interim Real Property Register in the Emirate of Dubai, as well as amendments made to Law No. 19 of 2017.
These regulations establish a clear framework for registering off-plan properties, as well as the rights and obligations of both buyers and developers.
Consequences If A Buyer Fails To Pay For The Off-Plan Property In Dubai
When a buyer fails to make payments to the developer at certain intervals, it counts as non-compliance with the terms of the Sale Purchase Agreement (SPA) signed by the parties. In such instances, developers can take the following actions:
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Notice to the Dubai Land Department (DLD).
The developer might notify the DLD about the buyer's failure to pay the purchase price. Consequently, DLD issues a warning to the buyer, giving them 30 days to act.
DLD can resolve disputes between developer and buyer prior to issuing a 30-day ultimatum.
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Certificate of Percentage Completion
If the customer fails to make the required payments within 30 days, DLD will provide a certificate to the developer verifying the off plan property’s percentage of completion.
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Legal Steps Taken by the Developer
After that, depending on the percentage of construction of the property, the developer may sue the buyer without going to court or arbitration within Dubai’s jurisdiction.
Thus, the developer has the following options in case a buyer fails to pay the purchase price:
- Keeping the buyer's payment by not canceling the SPA and requiring the buyer to pay the remaining balance of the purchase price.
- Selling the property via auction through DLD, in which case the developer will refund any surplus money to the buyer, once the auction is sold within a set time.
- Terminate the SPA unilaterally and keep a certain percentage of the purchase price based on the off-plan property’s percentage of completion, and refund the remaining amount to the buyer within the time frame specified in Article 11 of Dubai Law No. 19 of 2017 on Interim Property Register.
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