4 Misconceptions about Off-Plan Properties in Dubai Debunked

The number of transactions for off-plan properties in Dubai has been on the rise for the last few years. There are many reasons why both buyers and investors have shifted their focus to these properties. Among them, it’s the comparatively lower rates that attract them the most.

For instance, waterfront apartments come with a huge price tag. However, if it is an off-plan project, the price will be comparatively lower. This is due to the fact that the project is underdeveloped, and it can sometime before it is fully completed.

Despite the growing popularity of off-plan projects, there are some misconceptions prevailing about them. In this article, we have discussed some commonly spread myths and misconceptions about off-plan properties in Dubai and debunked them. Read on to know more about them:

1. They Can Get Cancelled Anytime

No, a project can’t just be termed as canceled. There’s an entire process that takes place and the project is deemed canceled. As per the law, nine reasons can lead to the cancellation of the project. Once the cancellation notice has been delivered to the developer, they reserve the right to appeal against the project cancellation. RERA can then accept or reject their appeal.

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Even if the RERA rejects their appeal and the project gets cancelled, there’s no loss to the buyers since they will get their money back, provided the project has an escrow account. RERA, after the cancellation of a project, appoints an auditor who is responsible for checking the escrow account and dividing the available funds to buyers/investors. In case the amount in the escrow account is not sufficient, the developer has to arrange the remaining funds within 60 days.

2. They Can Take Years to Produce ROI

Many believe that off-plan projects yield ROI after many years. Surely, it takes time for a project to be fully completed so that you can sell it or put it on rent. However, there is a chance that you will start getting offers for the property you have purchased during the construction period only. This happens if the project the property is part of has gained popularity in the emirate. Investors may directly contact you and buy the apartment at higher rates. This is a win-win situation for both parties since you will earn ROI sooner than expected, and the investor will have more listings in their inventory.

Bear in mind that this scenario will only turn into reality if the project is backed by a reputable developer and the promotion is done in the right way. Also, it is important to know that you can’t sell your off-plan property before it has reached a certain level of completion. So, take these factors into consideration before buying a property.

3. Location Doesn’t Matter

There’s a perception that when it comes to investing in off-plan property, the location doesn’t matter as it does for ready properties. Since it is an investment that will reap benefits in future, people do not pay a lot of importance to this aspect.

This, however, is a mistake you shouldn’t commit. No one would like to live in a property that is surrounded by nothing, away from the city. The area may get developed at some point in time, but until then, your investment will be blocked. This is why it is important to pay attention to the location as much as you would do for a ready property. If a property is located in a prominent area and has a special value associated with it, you can expect it to produce a high ROI for you. For example, Stella Maris Tower meets this criterion. It occupies a prime spot in Dubai Marina and is going to be the last waterfront development in the area.

4. They are Only Suitable for Investors

Another misconception about off-plan properties is that they are only suitable for investors. While it is true to an extent, end users can also benefit from the perks of off-plan properties. The only drawback is that, as an end-user, you will have to wait for some time before you could settle in that property.

A Final Word

In all, whether you are an investor or end-user, buying an off-plan property in Dubai can prove to be a wise decision, provided you have made this decision after thorough deliberation, consideration, and research. Take into account some very important factors like the location, payment plan, configuration, amenities, the reputation of the developer, etc., and then make an informed decision.