How to Verify Off-Plan Property Projects in Dubai
What you must check before buying an off-plan property in Dubai.In the current Dubai real estate market, off-plan properties are becoming increasingly popular. Investors and homebuyers are drawn to low starting prices, easy payment plans and the possibility of higher returns down the road. However, it can be very risky to invest in a project that is still under construction without first verifying its legitimacy and dependability. Thus, the purpose of this blog is to make it clear what to look for before making a reservation for an off-plan property in Dubai, how to make sure the project is authorized by law and how to protect your investment.
What is an Off-Plan Property?
Property units in a real estate project that are not yet finished or occasionally have not even started construction are referred to as off-plan property. The pre-sale of homes or apartments that the developer intends to construct in the future constitutes this kind of investment.
In the Dubai real estate market, off-plan properties are highly sought after. This is due to their potential for future price increases, flexible payment plans and typically lower prices compared to pre-made properties.
However, when purchasing an off-plan property, it is crucial to thoroughly examine the developer’s reputation, the project’s legal approval and the escrow account because the project takes time to finish. Off-plan properties can be a wise investment that will pay off in the long run if you do the proper research and make the necessary investments.
Why is it Important to Verify Off-Plan Real Estate Projects in Dubai?
- Investment protection is essential to ensure the safety of money invested in off-plan real estate.
- To verify the developer’s legitimacy both financially and legally.
- To make sure the project is officially registered.
- To aid in locating fraudulent activities and illegal projects.
- To guarantee the secure transfer of money through an escrow account.
- To ensure that the project is proceeding as planned.
- To protect contractual obligations and legal rights.
How to Verify?
Verify the Legitimacy of the Developers:
- Select only developers who are registered with the Real Estate Regulatory Agency (RERA) or the Dubai Land Department (DLD).
- Examine past project records to see if the projects they have built were timely and of high quality.
- To learn the truth, look through social media comments, forums and customer opinions.
- Find out if the developer has experienced any legal or tax issues.
- Make sure the developer is providing the proper RERA license and membership.
Verify the Registration of the Project:
- Ask for the Oqood Number, which is your official registration number provided by the developer.
- On the Dubai Land Department website, use the Oqood Number to confirm if the project is legally registered.
- Use the RERA platform to verify whether the project has been approved by RERA.
- Be especially cautious when you find inaccurate information in documents.
- To confirm the status of construction permits and approvals, consult official documents.
Check out the Purchase and Sales Agreement (SPA):
- The unit's dimensions, location and finishing requirements should all be made clear by the SPA.
- Examine the payment schedule to make sure the payment is made in line with the construction milestones.
- The date of handover should be specified along with any late payment penalties.
- Should the project fail or the developer fail to meet its obligations, the SPA should include refund terms.
- The SPA should contain guarantees against property standards.
- Before signing the SPA, speak with a real estate attorney or advocate.
- In the event of an emergency, the SPA should include provisions for ownership transfer.
Verify the Setup of the Escrow Account:
- The developer should only make payments into an escrow account that is governed by law; the operating account should not be used.
- Verify that the escrow account has been authorized by the Dubai Land Department (DLD) and the Real Estate Regulatory Agency (RERA).
- Verify the account number listed in official documents that the developer provided.
- The developer only receives cash flow after construction milestones are finished.
- Funds deposited via the escrow account are kept secure and protected by the law.
Regularly Monitor Construction Progress:
- If at all possible go to the construction site to observe the progress.
- Pay close attention to the developers frequent updates.
- Verify that the SPAs and the contracts milestones are being met by comparing the construction progress to the milestones.
- Talk to the developer right away if there are any delays or poor quality.
- Use the official documents available on the DLD/RERA portal to monitor the project's progress.
Regularly Monitor Construction Progress:
- If at all possible go to the construction site to observe the progress.
- Pay close attention to the developers frequent updates.
- Verify that the SPAs and the contracts milestones are being met by comparing the construction progress to the milestones.
- Talk to the developer right away if there are any delays or poor quality.
- Use the official documents available on the DLD/RERA portal to monitor the project's progress.
Check the Agent and Broker:
- Verify the agent’s RERA license and registration to ensure they are authorized to interact with the developer.
- Verify the broker card or RERA number that the agent supplied.
- Verify experience and credibility by looking at prior project management experience and client testimonials.
- Verify that the SPA Oqood and escrow account details are accurate as supplied by the agent.
- Select an agent who is cooperative and transparent.
- Agents should be prepared to share all information and respond to questions from clients.
Understand Your Fees and Legal Rights:
- When registering with the Dubai Land Department, there is typically a 4 per cent fee.
- Be aware of parking and property-related fees beforehand.
- Verify that Oqood Registration has officially registered your ownership.
- If the project is not finished or the developer does not fulfil its obligations, be aware of your legal rights to receive a refund.
- Before signing an SPA or any other contract, you must speak with a real estate attorney.
- Be aware of the legal actions pertaining to construction delays, flaws and unlawful activity.
FAQ
What is an off-plan property?
Property sold before construction is finished is known as off-plan property. It typically provides a better payment plan at a lower cost.
How can I verify the developer’s legal legitimacy?
The Dubai Land Department (DLD) and Real Estate Regulatory Agency (RERA) website allows you to verify the registration, look at past projects and read client testimonials.
How come the Oqood number is used?
The project’s legal registration status is verified using the Oqood number. The DLD and RERA portals can be used to verify this.