The number of Dubai developers providing sales incentives, as well as lower and more flexible payment plans for off-plan properties, is increasing to attract new investors and end-users.
The off-plan property market has sustained impressive momentum, with both local and international investors eagerly purchasing newly launched units, drawn by the potential for strong returns in a tax-friendly environment. Notably, there has been an increase in developers offering sales incentives, including lower down payments, flexible or extended payment plans, and promotional gifts.
As demand for off-plan units rises, competition among property developers is intensifying. The market is witnessing the entry of new foreign developers eager to capitalize on high demand and returns. To attract local and international buyers, some developers are offering flexible payment plans and promotional gifts.
Developers in Dubai are increasingly offering extended payment plans, with some extending beyond 4-5 years and providing monthly installments of less than one percent. Recently, a Dubai-based private developer introduced an eight-and-a-half-year payment plan, including five years of post-handover payments. Additionally, a 1 percent monthly payment plan has become popular among mid-budget properties, with one developer even offering a 0.5 percent post-handover plan. Some developers are also reducing down payments to as low as 10 percent.
In terms of returns, developers are promising high single-digit returns, with some even claiming double-digit returns depending on property location. UAE banks are now offering up to 10 percent additional financing for off-plan properties if construction is at least 50 percent complete. This move aims to stimulate the off-plan market and improve accessibility for buyers.
Traditionally, banks provided 50 percent financing, requiring buyers to cover the remaining amount. However, current financing options reflect the market’s strong fundamentals, including high equity, economic growth, infrastructure development, and a growing population. Lenders are now focusing on Tier 1 developers with proven track records.
The off-plan property sector is expanding rapidly, accounting for 60 percent of total transactions in July 2024, up from 49 percent in July 2023. This growth is driven by new project launches and increasing demand. The second quarter of 2024 saw a 2 percent rise in average sales prices, with areas like Jumeirah Village and Business Bay experiencing significant price increases.
Source : Khaleejtimes.com