
5 Things to Check Before Buying Off-Plan in Abu Dhabi
Check your price/sqft:
If your project isn’t discounted by atleast 10-15% to similar ready projects nearby or much better than them, you’re just buying at market price, but with a 4 year burden of no rental income. Off plan is meant to be discounted to reach market value by handover, and that’s mainly your appreciation.
Know the location:
I don’t believe there’s a genuinely bad freehold location in Abu Dhabi at the moment. All the freehold areas can be counted with two hands; it’s more about identifying which location suits your goals. Are you looking for a high yield? Are you looking for quick returns? Long term appreciation? Every area has its pros and cons, understand each one and your goals to make the right investment for you. Many investors made “bad” investments in top locations such as Hudayriyat, Yas, and even Saadiyat, because they didn’t understand the exit window for that area. Look at current and future supply in the area to know your future competition, it’s all on ADREC’s yearly reports.
Pick the right developer. If you really want to simplify it and make your investment easier and safer, only go for government developers. They get the best plots, they build full communities not just buildings, they make the whole process of buying more transparent, and have government backing incase of any problem. They know and dictate the market, and you’re more likely to make money investing with a government backed developer.
For private developers, you’ll have to be more selective. Personally, my go to private developer is SAAS due to their track record and unique products. Otherwise, unless it’s a branded residence or a really special project, i’m not considering another developer. Safety comes first in RE.
Avoid cash discounts and 1% payment plans.
RE is a business for the developers too, and no developer will offer discounts out of kindness. There’s always a catch. The catch is usually that price/sqft was way overpriced at face value, and the discount just takes it to market value. Another catch could be unfavorable SPA conditions, handover delays, and so on. Don’t look for the “best deal”, look for the best project.
Evaluate your opportunity cost.
When you buy off-plan, your capital sits locked for years earning nothing — no rent, no yield, just hope that construction-period appreciation shows up. Meanwhile a ready property starts paying you the moment you close: rent from the start. Opportunity cost is what that ready property would have earned you during the years the off-plan buyer was just waiting.
Run the numbers, and see if it makes sense. Most times, buying studios and expecting 25% + appreciation is unrealistic, you’ll be better off buying a ready studio and collecting 6% from rent yearly than waiting 4 years and paying 1M to make 100k.
Ahmad Sholi
Nationwide Properties LLC
Senior Advisor
0504926606