Dubai's Off-plan Real Estate market is experiencing a significant upward trend.

According to real estate experts, Dubai's off-plan property market is on an optimistic trajectory, driven by a noticeable increase in demand from both end-users and investors.

This surge in the off-plan market signals a favorable environment for real estate investments in the emirate, with a notable rise of 40% to 60% in both local and foreign property buyers.

"While the current landscape appears promising for the emirate's off-plan market, it's essential to acknowledge that various factors can impact the real estate sector, and trends may evolve over time," stated analysts at Betterhomes.

They reported an impressive 35% surge in demand for off-plan properties over the past three months, compared to the same period last year. Furthermore, off-plan transactions now constitute a significant 61% share of Dubai's overall real estate market.

Comparing the second quarter of this year to the same period in 2020, Dubai witnessed a remarkable 750% increase in off-plan sales, totaling Dh34 billion in agreements registered. Zazen Properties' research also documented approximately Dh30 billion worth of transactions over the past three years.

In August of the current year, off-plan sales dominated the market, accounting for the largest market share, as indicated by a recent Property Monitor survey. In fact, 64.7% of the market consists of off-plan sales. The total number of sales transactions also reached an all-time high for the month of August, with an 8.1% month-over-month increase, totaling 12,134 sales.

Real estate experts believe that the current market presents an excellent opportunity for investing in off-plan properties for several compelling reasons. They pointed out, "First, the changing landscape with rising mortgage rates has altered the feasibility of purchasing completed properties for investment purposes. Despite increased rental yields, the expenses associated with servicing a mortgage have risen, resulting in reduced net yields after factoring in all costs."

"Consequently, the economics of investing in completed properties for returns have become less favorable. Second, off-plan investments provide a distinct advantage by allowing investors to allocate funds to properties available at their original prices. The flexibility in payment plans helps offset the impact of high lending rates, ensuring greater financial adaptability. Third, Dubai's population growth acts as a significant catalyst driving demand for residential properties."

According to Betterhomes' analysis, off-plan properties have a substantial potential for value appreciation upon completion, owing to Dubai's continuous growth and the steadily increasing population. The report noted, "Investing in off-plan properties enables buyers to secure a property at a lower cost compared to finished units. Additionally, off-plan properties typically offer flexible payment plans, which can be advantageous for investors."