If you're looking to buy property in Dubai, you have choices like fancy apartments or future projects. When it comes to paying, people usually pick between a 1% payment plan or a mortgage. Both have positive points, but they fit different folks based on their money and what they want.
I'll compare the costs, ownership duration, and flexibility of the two plans. Plus, I'll show which strategy works better for different buyers.
In Dubai, a 1% payment plan is a popular method for purchasing properties before construction begins. Instead of a big down payment, you only pay 1% of the price at first. The rest is paid in smaller amounts until the property is ready.
This plan helps people handle their money better, especially if they're buying for the first time and don't have a lot of cash right away. Additionally, it allows buyers to participate early in a project, potentially increasing the property's value upon completion.
With easy payment options, the 1% plan is a cheap, simple, and easy way to invest in Dubai real estate without needing a substantial initial payment.
Small Deposit: You only need to pay 1% of the purchase price initially. This makes it easier to enter the Dubai real estate market, as you don't need to pay a hefty amount upfront.
Pay in installments: You can pay the rest in installments before the property is handed over. This helps you better manage your finances and budget.
Book Early: You can secure a property early, usually at today's prices. This means you could make a profit if the property's value increases upon completion.
Payment Options: Many construction companies offer adjustable payment plans, allowing you to adjust your payments to suit your budget.
Ideal for First-Time Buyers: This 1% payment plan is particularly suitable for first-time buyers due to its small deposit, gradual installments, and flexible scheduling options.
A mortgage is a common way to buy a property. A bank lends you the money. You usually put down about 20–25% of the price upfront. Then, you pay back the loan in monthly payments for several years.
Mortgages let you own the property right away, even while you're still paying off the loan. This is great if you want to rent it out quickly or get into Dubai’s property market.
With a set payment plan, mortgages give you a simple way to buy property. They work well if you have a steady income or want to use financing to make bigger buys.
Immediate Property Ownership: You become the legal owner upon purchase, even if you're still making loan payments. This means you can move in, rent it out, or watch its value rise from day one.
Use Your Money Wisely: A mortgage means you don't have to spend all your money at once. You can allocate a portion of it to other investments, savings, or investment opportunities.
Affordable Payments: Your monthly payments remain fixed, making it easier to manage your budget and plan.
Ideal for Investors and Expats: Investors can easily purchase a few properties to grow their investments. Expats can buy properties for the long term and generate rental income without depleting their entire savings.
Plan for the Future: Mortgages come with a fixed payment plan, allowing you to manage your finances and make the most of Dubai's growing real estate market over the years.
With our 1% plan, you just put down 1% at the start. Then, you pay the rest in small amounts until you get your keys. It's easier on your wallet, especially if it's your first time buying.
If you go with a mortgage, you'll need a bigger down payment, something like 20-25%, and then make monthly payments. This approach works well for investors and individuals living in other countries who want to finance their purchase without spending all their funds at once.
With a 1% payment plan, you own the property as soon as it's delivered to you and after all payments have been made. This option is ideal for long-term investment.
Or you can get a mortgage and own the home immediately. This means you can move in, rent it out, or watch its value rise immediately. It's an ideal option for investors or expatriates.
With a 1% payment plan, you have a profit margin. You can adjust your payments based on your financial ability. This relieves the pressure of high initial costs and helps you better manage your finances before you take possession of your home.
Regular mortgages aren't as flexible. The bank sets the repayment schedule, but this can be helpful if you want to know exactly what to expect each month, especially if you have a steady income and want a solid, long-term plan.
Are you new to buying? A 1% down payment plan may be the best option. It doesn't cost much upfront, and the payments are affordable.
Investment: Mortgages often make more sense. You own the home immediately, can rent it out as a source of income, and can even purchase more property with financing.
Living abroad: A mortgage is usually the best option. It allows you to own the property immediately and helps you plan your long-term investments.
With a 1% payment plan, you can own the property immediately and make all payments. It's a great option if you're considering a long-term investment.
Or you can take out a mortgage to speed up the process of owning a home. This means you can move in immediately, rent it out, or watch its value increase. It's a good option for investors or expats.
The choice between a 1% payment plan and a mortgage depends on your financial capabilities and the return you want on your investment. A 1% payment plan is ideal for first-time buyers who prefer low initial costs and affordable payments, making it easier to enter the Dubai real estate market. For investors and expats looking for immediate ownership, rental income, or a long-term investment, a mortgage is the ideal choice.
If you'd like more help choosing the right option, check out our off-plan real estate projects in Dubai and our Dubai mortgage guide for comprehensive information on all the ways to finance your purchase. Contact BinGhatti today to choose the right plan for your needs and start your property purchase without worry.
