It is no secret that the real estate market in the United Arab Emirates is demonstrating impressive growth dynamics, setting a new record in 2023 with the volume of transactions exceeding 528 billion dirhams.
The rapid development of the construction sector is particularly attractive to buy apartments at the construction stage, which is confirmed by statistics: more than 60% of all real estate transactions in Dubai in recent years fall on off-plan objects. This trend is not only due to the financial benefits for buyers, but also due to the unique system of guarantees provided by the government through specially created regulatory bodies.
Modern Dubai offers investors unprecedented opportunities – from luxury penthouses in skyscrapers to cozy apartments in eco-friendly complexes with their parks. At the same time, each project is developed considering advanced technologies and the highest quality standards, which guarantees not only comfortable living, but also a steady increase in real estate value. But how to choose the one that will meet expectations and bring the desired profit among the many tempting offers?
Advantages and risks of buying an apartment at the construction stage
Unlike the European real estate market, where the purchase of under construction housing is often associated with significant risks and long waiting periods, the UAE market offers more attractive conditions. For example, while in the UK the average construction period of a residential complex can reach 4-5 years, and delays occur in 70% of cases, in Dubai most projects are realized strictly on schedule within 2-3 years. In CIS countries buyers often face the problem of under-construction and bankruptcy of developers, while in the UAE such cases are practically excluded due to strict state control.
Read also: Registration of real estate with the state authorities.
The investment attractiveness of real estate at the construction stage in the UAE is supported by the possibility of obtaining a resident visa and tax preferences. While European countries are tightening conditions for foreign investors, the Emirates, on the contrary, create an increasingly favorable climate for international buyers. At the same time, the developed real estate service business allows owners not to worry about managing their assets, even when they are outside the country. And quietly receive monthly rent payments, even if it is on the diametrically opposite corner of the globe.
Criteria for choosing an apartment at the construction stage
When choosing an apartment in the under-construction object, it is necessary to consider not only the neighborhood’s current characteristics, but also the prospects of its development according to the master plan Dubai 2040 Urban Master Plan. This document provides for large-scale development of infrastructure and the creation of new business clusters, which directly affects the future value of real estate. For example, the Dubai South area, where active construction is underway, demonstrates an annual increase in real estate prices by an average of 12-15% due to the proximity to EXPO City and the new airport Al Maktoum International.
When evaluating a residential complex, special attention should be paid to the concept of the project and the amenities offered. Modern developers in the UAE emphasize creating a complete living ecosystem, where 24-hour concierge service becomes just a basic element of comfort. It is important to evaluate the ratio of residential and public spaces, the presence of green areas, sports infrastructure and commercial areas. For example, in the advanced projects of Dubai Creek Harbour the share of public spaces reaches 60% of the total building area.
Read also: Taxes on the purchase of real estate in the UAE for EU citizens.
The technical equipment of future housing deserves special attention. Leading UAE developers implement smart home systems already at the construction stage, integrating them with the complex’s general infrastructure. This allows not only to increase the level of comfort but also to optimize the cost of utilities.
Even independent experts from other countries note that modern construction technologies used in the Emirates ensure high energy efficiency of buildings, which is especially important given the region’s climatic peculiarities.
How to check the developer and the reputation of the project
In 2024, the leading positions in the Dubai real estate market are held by such developers as Emaar Properties, known for its landmark projects Downtown Dubai and Dubai Creek Harbour; DAMAC Properties, which implements ambitious projects involving international brands and creates innovative residential complexes with a focus on sustainable development. Of particular note is Nakheel, which has regained its position as one of the largest developers in the Emirate after a successful restructuring.
The reliability of the developer can be checked through the RERA system, where information on all registered projects and building permits is available. It is important to examine the portfolio of completed projects and the company’s financial statements, which are published for public developers. The escrow accounts of the project should also be monitored – according to UAE law, all buyers’ funds must be kept in special accounts and can only be used for the construction of a particular project.
To obtain objective information about the developer it is recommended to visit the sales office, study the layouts and documentation of the project, as well as talk to representatives of the company. Serious developers usually provide detailed information on construction technologies, materials used and the timing of each project stage. It is also helpful to check the presence of litigation and claims from buyers in previously realized projects. As a rule, in the UAE developers value their reputation and it does not come to litigation.
Financial aspects and payment terms
The transparency of Dubai’s tax system has become a magnet for international investors. Financing real estate purchaseat the construction stage in the UAE is characterized by flexibility and various available options. Developers offer attractive installment plans, often requiring no down payment or providing the option to pay the bulk of the amount upon completion of construction. Interesting is also the fact that in the Emirate there is no classical taxation of real estate, but there is a clear structure of mandatory payments in the transaction. Let’s break down all the financial nuances to be faced with:
- The transfer fee to the Land Department is fixed at 4% of the value of the object. An interesting feature of the local market is that this payment is often divided equally between the seller and the buyer, which significantly reduces the financial burden. This fee serves as a guarantor of the legitimacy of the transaction in the eyes of the state.
- The registration fee has a curious gradation. For premium properties valued above $136,000, it is about $1,090.This payment ensures the entry of your object in the state registry and protects the right of ownership.
- A real estate agency commission in Dubai is not just a service fee. Local realtors act as official mediators of the transaction and are legally responsible for its purity. The remuneration ranges from 2% to 7% and depends on the complexity and volume of work.
- The final touch is to register the certificate of ownership for 70 dollars. This is a small but significant investment in documenting your rights to the property.
As for financing, the Dubai market offers flexible solutions:
- Local bank mortgage programs are amazingly affordable: rates range from 2.5% to 7% per annum, with a planning horizon of up to 25 years. Down payment varies from 20% to 50% — it all depends on the client’s financial profile and the selected object.
- Developers often offer interest-free installments of up to two years – an excellent alternative for those looking at properties under construction.
Payment can be made in several ways:
- Direct bank transfer through reliable banks.
- Cryptocurrency transactions with subsequent conversion.
- Bank checks, which the agency prepares after receiving the funds.
The purchase process itself is organized logically and transparently: preliminary contract, deposit (usually 10%), main contract, and registration with the Land Department. Notably, a foreign buyer requires a minimum of documents — a valid passport is sufficient. Government oversight of the real estate market in Dubai creates a unique atmosphere of safety and predictability. Each transaction is held under the scrutiny of regulatory authorities, which virtually eliminates the possibility of fraud or violation of property rights.
Read also: Features of buying housing in Dubai for citizens of Ukraine.
Conclusion. Buying an apartment under construction in the UAE is an opportunity not only to purchase quality housing at an attractive price, but also to invest in one of the world’s most dynamically developing real estate markets. The main advantage of the Dubai market is its transparency and predictability. There are no hidden fees or unexpected requirements: all processes are regulated and transparent, making investing in local real estate profitable and comfortable. With the right approach to selecting the object and a thorough check of the developer such an investment can bring significant profits in the short term. But it is tough to understand all the nuances independently, because of its versatility Dubai seems to be an uncharted white iceberg on the world map.
I, Konstantin Lyutovich, representing 20-88 Real Estate, are ready to offer professional support at all stages of selecting and purchasing real estate in the UAE. Our company has extensive experience of working with leading real estate developers in the region. It provides a full range of services – from selection of the property to legal support of the transaction. Contact me for a personal consultation and selection of the best option for investment in UAE real estate. Was the publication interesting and useful? Want to know everything about taxes and fees? Subscribe to the real estate portal in Dubai and receive notifications about new publications on the Lyukos website.
