‘Off-plan’ refers to properties that are still being built. Regardless of their ongoing development, they represent a dependable and profitable investment asset. In many cases, they are superior to a finished build.
The main reason for purchasing off plan properties is how much less you’ll have to pay for it. You’ll likely save tens of thousands of dirhams when compared to a completely market-ready apartment or rental home. The earlier you buy, the less expensive it will be.
Developers want to sell their units as soon as possible, which is why prices for early adopters are lower. When it comes time to sell, investors who buy off plan Properties stand to make more money.
If you are looking to buy off plan properties with an eye on making a profit in the future, you should choose your property carefully and consider these factors which will affect its value. After all, capital appreciation is not just for investors. Here are the factors that directly affect off plan properties prices.
Location
The location of the off plan properties is the most important, if not the most important, factor to consider. At the most basic level, you want to buy a home in areas with the highest demand. This is true for both investors looking to rent out the property and home buyers looking to sell the property for a profit a few years down the road.
Many different factors come into play here, such as whether off plan properties is in or out of the city centre, its proximity to local schools and universities, nearby amenities, convenient transportation options, and much more. If you can find a property that is close to everything people need to live a happy life, you will most likely be making a good investment.
Size
The size of off plan properties has always been an important factor in determining its value, but the ongoing lifestyle changes caused by the Covid-19 pandemic have changed that. All value is relative to people’s desires, and the last 18 months have seen a “race for space” take off. The rise of home working, as well as many people’s realisation that they are willing to pay more for more space, has put a premium on larger apartments.
Clearly, there is value in purchasing in-demand off plan properties, and when making your decision, you should consider the desire for space as part of it. Payments can be spread out over several weeks or months to ease the strain on your bank account.
Comparison
The number of available off plan properties in a neighbourhood will have an effect on values, especially if there are a large number of the same unit type – or so the conventional wisdom goes. In reality, it is more important to determine whether there is an excess of available property rather than how many of a specific unit type exist in a given area.
Fundamentally, how many similar off plan properties there are to yours is irrelevant if you are following a solid property investment strategy and purchasing in the right area. Where there is a high demand, your property’s value will rise regardless of whether it is in a block of comparable off plan properties.
Why should I invest in off plan properties?
Let’s go over the main advantages of off plan properties once more for reference:
- Off plan properties are initially less expensive to purchase. They are less expensive because they are not yet finished to a rentable standard.
- You can sell before the construction is completed, resulting in a quick return that capitalises on the momentum in a local market.