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Off-Plan Payment Plans in the UAE: Pros and Cons

Pros and Cons of Off-Plan Payment Plans in The UAE

Off-plan properties are ones that are either being constructed now or will be soon. Investing in such projects offers a number of advantages, including cheaper costs, higher capital returns, better rental yields, and flexible off-plan payment options. An off-plan payment plan is a schedule of payments for a property that is being built (off-plan) that has been established by the project’s builder or developer.

Off-plan payment arrangements have their own benefits and drawbacks. Before we go into the benefits and drawbacks, let’s have a look at the many sorts of off-plan property plans.


off-plan payment plans
There are several flexible off-plan payment options available for buyers' convenience.

The following off-plan payment plans are flexible in Dubai: 80-20, 60-40, 70-30, 50-50, and post-handover. The two stages of the off-plan payment plans are during construction and at handover.

For instance, under the 80-20% payment plan, buyers are required to pay 80% of the total property price while the project is being constructed, and the remaining 20% must be paid upon the project’s completion when the property is turned over.

Off-plan payment plans are provided while the project is still being built. Because of this, customers can pay over time before getting the keys to their house. In accordance with their financial situation, customers also have the choice of obtaining a mortgage from the bank.

In Dubai, the mortgage pays for 50% of the total cost of the off-plan property. When the buyer has already given the developer the remaining 50%, the bank gives this 50%. Simply simply, instead of paying the developer in full, the buyer pays the bank in installments.

Also, under the post-handover payment plans, customers have the option to purchase a home by paying a portion of the entire property value, rent the property out, and then pay the balance using the rental returns.


advantage of off-plan payment plans
Off-plan payment plans' main benefit is that they are affordable.

The UAE real estate industry is rapidly expanding and provides several investment options for both ready-to-move-in and off-the-plan properties. We have developed a list of the most typical benefits of using off-plan payment arrangements when acquiring real estate.


Off-plan projects typically have lower prices.
Off-plan projects typically have lower prices.

The off-plan payment plans are generally offered at a lower value because the property is still being constructed. Such properties do not face the same level of competition as ready properties. Yet, the costs of off-plan properties typically increase after completion. Both novice investors and experienced purchasers can gain from this advantage.


The many types of payment plans outlined above are only a few of the flexible options that developers provide to consumers.


pay easily in instalments
With off-plan payment plans, buyers may conveniently pay in installments.

Favorable instalments are one of the additional benefits of off-plan payment arrangements. While buying off-plan properties, buyers are not required to make a single, large payment. They may simply pay in smaller installments using off-plan payment plans rather than making a hefty upfront commitment.


Off-plan projects are still in the planning stages, which benefits purchasers by allowing them to select the style of apartment they like from the floor plan at a reasonable price. Saving money on investment and future capital gains are both benefits of such ventures.


Off-plan payment plans may also have certain cons. They consist of:


Delays are on the checklist when buying off-the-plan properties. Simply merely, some projects take longer than expected to complete than originally estimated. In Dubai, the possibility of delays is fairly typical when contemplating off-plan real estate. The projects are also canceled sometimes. This indicates that the prior installment payment is still at risk until the project is completed.


When compared to the initial design, there may be modifications in the project’s quality. There’s a chance the finished item won’t meet the buyer’s standards. Thus, do extensive research on the developer before choosing off-plan houses. To learn more about off-plan properties,


A decrease in the property’s value due to real estate market fluctuations might lead to a reduced return on investment. The major drawback of off-plan payment options is this. The original established price of the property determines how much the buyer would pay in installments, and if that price drops, the buyer’s prospects of receiving a greater return on investment also fall.


AR is a word at heart, despite being a minimalist at heart. He is always looking for new topics to write about.

This Blog is provided solely for educational reasons, including broad information and a general comprehension of its content, including related laws and regulations, and is not intended to give particular legal advice. The Blog is not intended to replace competent advice from a registered expert.


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