In Dubai’s growing real estate market, it is common for investors to buy off-plan properties with the intention of selling them before their completion. Selling an off-plan property in Dubai is a profitable venture if you do it right. But how to sell off-plan property in Dubai? Are there any legalities for doing so? What are the benefits of selling off-plan properties in Dubai?
If you are looking for the answers, this guide is tailor-made for you. We will cover everything from setting a good price and finding potential buyers to negotiating and handling legal paperwork. Whether you are selling the property yourself or working as a real estate agent for someone else, these tips will help you get the best price and make the process easier.
Understanding the Off-Plan Properties in Dubai
“Off-plan properties” are the real estate units sold before they are built. Buyers purchase these properties based on plans and digital images, often at a lower price than fully completed units. In simple words, it is like buying a home before construction starts, which can help save money.
Why Off-Plan Properties are Popular in Dubai?
In Dubai, off-plan properties have gained popularity for a few reasons. First, they are usually cheaper than finished properties because developers can pass on savings from bulk buying materials. Also, buying off-plan often lets buyers choose details like fittings and fixtures even before construction starts.
How Does Off-Plan Properties Sale Work in Dubai?
When you buy an off-plan property in Dubai, you are purchasing it based on a design plan before its completion. Payments are made in stages: an initial deposit secures the property, followed by further payments as construction progresses. Once you have paid in full and the property is officially registered, you receive ownership and the title deed.
Risks to Consider
It is important to note that there are some risks with off-plan properties. For example, construction might be delayed, or plans might change, which can affect the completion date or the final features of the property. Developers could also face financial issues, potentially slowing down or even stopping the project. It is important to understand these risks and seek legal advice to protect your investment.
Thorough research and understanding the process of buying off-plan in Dubai, can help you enjoy lower prices and more customization options. However, be prepared for potential delays or changes to minimize risks.
How to Sell Off Plan Property in Dubai? Step-by-step
Here are the major steps in reselling off-plan properties in Dubai.
1. Getting the NOC from the Developer
In order to resell an off-plan property in Dubai before it is completed, you need to get an NOC (also known as a no objection certificate) from your developer. This document shows that the developer agrees to the sale. Most developers will provide an NOC for a transfer fee. Once you have the NOC, you can move on to the next steps.
2. Define a Price for Your Property and Advertise
After obtaining the NOC, you need to decide on a price for your property based on current market rates and similar listings. It is a good idea to work with a real estate agency to help you advertise your property. They can list it on major real estate websites and use their network to find potential buyers.
3. Handle Offers and Receipts
When you get an offer you are happy with, give receipts to the buyer for their down payment and any other payments. It is important for both you and the buyer to submit these receipts to the developer. They are needed for the buyer to register the property officially.
4. Complete the Sale
The last step is to sign the necessary documents for ownership transfer. This usually involves a Transfer of Ownership Agreement and an Assignment Agreement. You will need to provide the developer with copies of these signed agreements so they can update their records and register the new owner.
Once these steps are complete, you will have successfully sold your off-plan property in Dubai before its completion. The new owner will then continue to make payments to the developer until the property is ready for the handover.
Important Conditions to Meet Before Selling an Off-Plan Property in Dubai
In order to sell an off-plan property in Dubai, owners must follow specific rules set by the developers and the government.
Typically, you can sell an off-plan property after paying 30% to 40% of the total price, though this can vary depending on the project and developer.
It is a good idea to check the exact percentage required for your property before you proceed with the sale. Both the seller and the buyer must also meet any conditions outlined in the developer’s contract.
Costs of reselling off-plan property in Dubai
Buyers thinking about buying an off-plan property must be aware of the following costs:
- Registration Fee: This is a significant part of the total cost. Buyers need to pay 4% of the property’s price as a registration fee to the Dubai Land Department (DLD).
- Transfer Fee: For properties valued under AED 500,000, the transfer fee is AED 3,500. If the property is worth more than AED 500,000, the fee increases to AED 5,000.
- NOC Charges: The developer’s No-Objection Certificate (NOC) usually costs around AED 5,000, and buyers are usually responsible for paying this fee.
Benefits of Reselling Off Plan Property in Dubai
The following are the key benefits of reselling off plan properties in Dubai for sellers. Buyers can also greatly benefit from buying off-plan properties in Dubai.
Higher Demand and Prices
Reselling an off-plan property before it is completed lets you benefit from the high demand during the early stages of the project. Buyers are often willing to pay more to secure a property in a new development early on. By selling at this stage, you can usually get a higher price compared to waiting until after the property is completed when there are more units available.
Flexible Instalments for Buyers
One of the main advantages of buying off-plan property is the flexible payment options. Most developers offer to split the total cost into monthly instalments, which makes it easier for buyers to fit the payments into their budget. There are different payment plans available for off-plan properties in Dubai; you can choose the one that suits you.
Reduced Risk
While all real estate investments carry some risk, selling an off-plan property before its completion helps shift that risk to the new buyer. They take on any potential delays in construction or changes in the property market that might affect the property’s value. As the original owner, you secure your profits and exit the investment with less risk and uncertainty.
Avoid Extra Fees
Some developers impose penalties or additional fees if you sell your property after a certain time. To avoid these extra costs, consider selling early in the development process. This way, you also avoid paying ongoing service or property fees beyond the initial deposit.
Off-plan Properties Dubai—Frequently Asked Questions
How to attract buyers to sell my off-plan property in Dubai?
If you want to attract more and more buyers for your off-plan property in Dubai, focus on highlighting its standout features, such as its views, location, and closeness to shopping centers, schools, and public transport. You can also make your property more appealing by offering incentives like discounts, flexible payment plans, or even furnished options.
Can off-plan properties be delayed?
Yes, off-plan properties can sometimes be delayed. Developers usually have a grace period to complete the property. If the property is not delivered by the end of this period, buyers can take legal action.
How long does it take to sell off-plan property in Dubai?
The time it takes to sell an off-plan property in Dubai can vary. It depends on market conditions, the property’s location and quality, and how well you market it. Finding a buyer and completing the sale can take anywhere from a few weeks to several months. Effective marketing and competitive pricing can help speed up the process.
What if I cannot make my instalment payments on time?
If you miss an instalment payment, you may face fines. If you continue to miss payments, you could be declared a defaulter, and the property might be sold to another buyer.
Can I sell my off-plan property before it is completed?
Yes, you can sell your off-plan property in Dubai before it’s completed. However, you need to follow the developer’s rules and requirements if you plan to do so.
Can I get a mortgage for an off-plan property in Dubai?
Yes, you can get a mortgage to buy an off-plan property in Dubai. However, you need to meet specific requirements set by the bank or financial institution.
Summing it up
In Dubai’s real estate market, selling off-plan properties can be profitable if handled correctly. Off-plan properties are popular in Dubai because they are usually cheaper and offer customization options. Buyers pay in different stages, starting with a deposit, and receive ownership once the full payment is made.
However, risks like construction delays and financial issues with developers should be considered. In order to resell an off plan property in Dubai, you need a No-Objection Certificate (NOC) from the developer. Then, set a competitive price, handle offers and receipts, and finalize the sale with legal documents.
Also, be aware of costs like registration, transfer fees, and NOC charges when buying or selling off-plan properties. Feel free to explore some of the best off-plan properties in Dubai.