Dubai: UAE’s off-plan properties are witnessing high demand from individual investors, who are vending these units even before finishing it, as per the Property Finder report.
“Over the years, investors have increasingly chosen to ‘flip’ their properties and participate in secondary off-plan sales where they sell their unit while it is still under construction,” said Property Finder.
During May 2020, in the midst of lockdown, the secondary, ready market collapsed considerably. This was the only month in which developers sold around multiple times more prepared properties than singular financial backers.
The breakdown remained at 23% by investors and 77 percent by developers. This slowly moved for investors, expanding to 55 percent in June, peaking at 73% in October, and settling at 68% in January and February this year.
“As the primary, completed developer inventory increases, it will be interesting to see how developers will sell these units as they will be competing with secondary properties,” said Lynnette Abad, Director of Research & Data for Property Finder.
“In 2019, we saw a wave of live-to-own payment plans and incentives from developers, which could be alluring options today due to buyer sentiment significantly rising in the market,” she added.
Consumers go for ready units
For developers, prepared properties have become a large chunk of their deal turnover. Making up 28% in May 2020, this number has since climbed to 46 percent in August 2020 and has been averaging at 43% percent in the course of the most recent 4 months.
In January 2021, the percentage of whole deals that were ready properties by the developer was 47.6 percent and in February 2021, it stood at 43.89%.
“The trend is clear that there is going to be no shortage of primary, completed units in the market, and developers will need to move their stock,” said the report.