Advantages of investing in real estate in UAE at the construction stage

Advantages of investing in real estate in UAE at the construction stage - Makebiz

Buying real estate under construction has become a popular investment strategy among foreign investors in Dubai. 

Such off-plan projects, involve several advantages over ready-made properties:

1. Favorable pricing. Developers often offer significant discounts on properties under construction. This can result in savings of 10% to 20% compared to the price of a completed property.

2. Convenient payment plans. Many developers offer convenient installment plans that allow buyers to make payments over several years. In some cases, the down payment can be as little as 5-20% of the total cost.

3. High ROI potential. Real estate under construction typically has a higher ROI potential because it increases in value as construction work is completed. In addition, investors can earn passive income by renting out the space.

4. Government support. The UAE government has recently adopted initiatives to support foreign investors. Since 2024, citizens who purchase real estate worth AED 2 million at the construction stage can apply for a 10-year golden resident visa.

The market of new buildings in Dubai offers a wide range of objects in both budget and premium segments. Investors can easily find suitable options in various neighborhoods with different growth potential.

Despite the benefits, investing in under-construction properties comes with some risks:

  • Delays in construction work due to a number of reasons, which will alter the completion dates of the property. This may affect rental plans and investment returns.
  • Financial problems of the developer may suspend construction or cancel the project altogether. Of course, this may result in a loss of investment.
  • Possible defects in the construction process, which will only become apparent upon completion, may result in additional repair or maintenance costs.

To minimize the risks of investing in off-plan projects, you should:

  • research the developer and its reputation by studying the history of construction projects;
  • scrutinize the purchase agreement to make sure it includes guarantees in case of construction delays or financial problems of the company;
  • consider insuring the property against defects in the construction process.

Investing in real estate under construction in Dubai is definitely worth considering as a promising investment. Offering favorable prices, convenient payment plans and high growth potential, such projects attract foreign nationals. However, it is important to be aware of the risks and take measures to minimize them.

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