Buying off-plan property in Dubai
Off-plan property in Dubai has become quite a rage lately. Though the concept is becoming increasingly successful, there are speculations in the property market as to what factors make selling and buying of off-plan Dubai property so.
The article gives an overview of the factors impinging on off-plan property in Dubai that have to be borne in mind by a prospective buyer.
• The Property Developer
Before going in for off-plan property in Dubai, one has to have an inside out knowledge of the respective developer. The name, the years in business, past projects, business record, history of any complaints against him/her or their development, are all important considerations to be made. Buying property is not a small deal and trust factor is crucial.
• The Financial Scaffolding
It is again vital to know who is backing the respective property developer. In Dubai, the least risky transactions are with government projects. Big names in Dubai property market such as Nakheel, Dubai Properties and Limitless are fully owned by the government which in turn has a major stake in Emaar as well.
• Price of Property Units vis-à-vis Construction Costs
If the property units in question look too cheap to be able to be completed, think twice. Low off-plan rates are a warning signal as they hint towards inferior quality/ failure of the developer to deliver the completed property in the face of financial trouble.
• Escrow Account Bank Details
Since July 2007, it is compulsory to have escrow accounts for all off-plan property developments in Dubai. It is crucial to know the bank which is providing escrow facilities for a particular development. It is always a good idea to go for a property wherein the bank is owned or controlled by the government.
• Payment Structure of the Property
One needs to go through the payment structure of off-plan property in Dubai carefully to see if it suits one’s practical circumstances. This is particularly important when getting the property financed. Certainly one doesn’t want to pay interest for a loan if the project is delayed.
• Stage of Development of the Property
The risk factor involved in off-plan Dubai property depends upon the stage of development as well. If the construction hasn’t started and all that the developer can show is the architect’s drawing, then the probability of project delay is the highest. It is far more likely that the property unit will be delivered on time if you can see a substantial chunk of work already done.
• Costs of Renting Temporary Property
If buying off-plan property in Dubai means that you’ll have to stay on a high rent for a long time, you’ll need to add these costs to the total expenditure. If this figure is quite high, shifting to a completed property in a lesser known place is a better and more sensible idea.
• Location of the property in Dubai
Since location of a property is one of the most important points to consider before making the purchase, it is always advisable to check the locality personally.
Also Read: Dubai Property Market - Buy or Rent?
The article gives an overview of the factors impinging on off-plan property in Dubai that have to be borne in mind by a prospective buyer.
• The Property Developer
Before going in for off-plan property in Dubai, one has to have an inside out knowledge of the respective developer. The name, the years in business, past projects, business record, history of any complaints against him/her or their development, are all important considerations to be made. Buying property is not a small deal and trust factor is crucial.
• The Financial Scaffolding
It is again vital to know who is backing the respective property developer. In Dubai, the least risky transactions are with government projects. Big names in Dubai property market such as Nakheel, Dubai Properties and Limitless are fully owned by the government which in turn has a major stake in Emaar as well.
• Price of Property Units vis-à-vis Construction Costs
If the property units in question look too cheap to be able to be completed, think twice. Low off-plan rates are a warning signal as they hint towards inferior quality/ failure of the developer to deliver the completed property in the face of financial trouble.
• Escrow Account Bank Details
Since July 2007, it is compulsory to have escrow accounts for all off-plan property developments in Dubai. It is crucial to know the bank which is providing escrow facilities for a particular development. It is always a good idea to go for a property wherein the bank is owned or controlled by the government.
• Payment Structure of the Property
One needs to go through the payment structure of off-plan property in Dubai carefully to see if it suits one’s practical circumstances. This is particularly important when getting the property financed. Certainly one doesn’t want to pay interest for a loan if the project is delayed.
• Stage of Development of the Property
The risk factor involved in off-plan Dubai property depends upon the stage of development as well. If the construction hasn’t started and all that the developer can show is the architect’s drawing, then the probability of project delay is the highest. It is far more likely that the property unit will be delivered on time if you can see a substantial chunk of work already done.
• Costs of Renting Temporary Property
If buying off-plan property in Dubai means that you’ll have to stay on a high rent for a long time, you’ll need to add these costs to the total expenditure. If this figure is quite high, shifting to a completed property in a lesser known place is a better and more sensible idea.
• Location of the property in Dubai
Since location of a property is one of the most important points to consider before making the purchase, it is always advisable to check the locality personally.
Also Read: Dubai Property Market - Buy or Rent?
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posted by Property Reporter at
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