The real estate market in Dubai is changing rapidly. Whereas previously many investors resold their off-plan properties for a profit, the number of sales at the original purchase price is noticeably increasing. This trend speaks volumes about the current state of the market.
What is an off-plan resale?
In an off-plan resale, an investor sells a property they originally purchased directly from a developer, before it has been completed. This can be shortly after purchase or even years later. Increasingly, this is being done without making a profit, purely to recoup the initial investment.
Why is less profit being made?
Too many new projects
The number of new off-plan properties has increased enormously: from 44,000 in 2022 to 110,000 in 2024. This means that on average, approximately 300 new properties are sold every day. Consequently, there is little reason for buyers to take over an existing off-plan property with a two-year construction period when a new project is being launched again next week.
Higher capital requirements for resale
Many developers, such as Emaar and MERAS, now require higher payments to be made before a property can even be resold. Whereas 20% was previously sufficient, Emaar now requires 50% of the purchase price to have been paid. This makes reselling financially more burdensome and less attractive.
More ready-to-move-in supply
As more completed properties become available, end-users prefer to choose a ready-to-move-in home over a resold off-plan property that is still under construction. The immediate convenience of use plays a significant role here.
Stricter payment plans
Following the coronavirus pandemic, many developers offered flexible arrangements such as post-handover payments or 50/50 plans. Now that demand has increased again, major developers like Emaar are requiring higher down payments during the construction phase. This means a buyer not only pays a premium for an existing off-plan property but also incurs additional interim costs.
What does this mean for the market?
The flipping market in Dubai is clearly in decline. For investors, this means that making a quick profit through resale has become less of a certainty. For buyers, this could present opportunities to enter the market at competitive prices, provided they pay close attention to location, developer, and build quality.
Edward Clarke is a seasoned property expert with extensive experience in international real estate investment, with a particular focus on Dubai’s fast-growing property market. Drawing on both personal investment experience and years of client advisory work, he helps investors make informed, realistic decisions when purchasing apartments, villas or off-plan developments in Dubai. With a pragmatic mindset, a sharp focus on returns and a strong commitment to transparency, Edward is a trusted point of contact for anyone considering a property investment in Dubai.
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