K|Wise · Glossary
Off-plan
A property purchased before construction is complete. Off-plan purchases are typically paid in instalments tied to construction milestones, with final drawdown at handover.
In plain English
A property purchased before construction is complete. Off-plan purchases are typically paid in instalments tied to construction milestones, with final drawdown at handover.
What Off-plan means in practice
Buying off-plan means committing to a property that does not yet exist in finished form. Payment follows a schedule tied to construction progress rather than a single completion date.
The attraction is the entry price and the staged payments; the risks are completion timing and the possibility that the property is worth less at handover than the price agreed years earlier.
How it works in the UAE
UAE regulation caps off-plan financing at 50% for every buyer category, so half the purchase price has to come from the buyer. Most of the construction-phase instalments are self-funded, with mortgage finance arranged at or near handover and assessed against a fresh valuation at that point.
A worked example
On a AED 1,800,000 off-plan unit, financing is capped at AED 900,000. The buyer funds the remaining AED 900,000 across the construction schedule and arranges the mortgage as handover approaches.
Terms that come up alongside Off-plan
Handover
The point at which an off-plan property is completed and the keys are transferred to the buyer. Final mortgage drawdown on off-plan units typically occurs at handover.
Read the definitionAmortisation
The gradual repayment of a mortgage loan through scheduled monthly instalments of principal and interest. In the early years more of each payment goes to interest; in the later years more goes to principal.
Read the definitionBuy-to-Let Mortgage
A mortgage used to purchase a property that will be rented out rather than occupied by the borrower. Lenders assess the deal on projected rental income alongside the borrower's personal income.
Read the definitionCap
A contractual maximum on how much your variable mortgage rate can rise over a defined period. A common UAE structure caps the rate at 5.99% for the first 3 years.
Read the definitionConveyancing
The legal process of transferring property ownership from seller to buyer, including title checks, NOC issuance, mortgage registration, and the final Land Department transfer.
Read the definitionDBR (Debt Burden Ratio)
The total of your monthly debt commitments — mortgage, car loan, credit card minimums, personal loans — expressed as a percentage of your net monthly income. UAE Central Bank caps the DBR at 50%.
Read the definition