Can You Buy Property in Dubai in Instalments? How Payment Plans Work
Written by: Marcus M. Araz, MBA, PhD · Updated:
Yes. Almost all off-plan homes in Dubai are sold on the developer’s own payment plan, in interest-free instalments. Usually 10% to 20% of the price is paid on reservation, part of the rest during construction and the balance on handover. In some projects instalments continue for two to five years after handover. No bank loan is needed and developers usually do not ask for proof of income. Payments go into the project’s escrow account registered with the Dubai Land Department (DLD).
Types of payment plan
| Plan | How it works | Who it suits |
|---|---|---|
| Construction-linked plan (such as 60/40 or 70/30) | 10% to 20% on reservation, instalments as construction progresses, the balance on handover. The first figure is the share paid before handover, the second the share paid on handover | Buyers who can settle the balance on handover in cash or with a mortgage |
| Post-handover plan (post-handover) | Part of the price is spread over the period after handover, usually two to five years; the flat can be let during this time | Investors who want to pay part of the instalments from rental income |
| 1% monthly plan | After reservation, 1% of the price is paid every month; the term varies by project | Buyers who want to split payments into regular monthly amounts |
| Instalments on ready homes | Rare; some developers offer short plans on completed stock | Buyers who want rental income straight away |
Plan structures vary from project to project. In our portfolio, for example, Hillcrest by Binghatti is on sale with a 70/30 plan and Skyblade by Binghatti with a 10% deposit.
Example: an AED 1,000,000 flat on a 60/40 plan
The schedule below is an indicative example of a typical construction-linked plan; the actual instalment dates and percentages are set out in the project’s sale agreement.
| When | Payment | Amount |
|---|---|---|
| Reservation | 10% of the price | AED 100,000 |
| Reservation | DLD registration fee (4%) | AED 40,000 |
| During construction | 50% of the price, in instalments linked to construction milestones | AED 500,000 |
| Handover | 40% of the price | AED 400,000 |
| Total | Price and DLD fee | AED 1,040,000 |
The amount paid on reservation is not just the deposit: the DLD’s 4% registration fee and small admin charges are also due at this stage. For an itemised list of costs see our Cost of buying a home in Dubai , and for your own figure use our Dubai purchase cost calculator .
How the balance on handover is paid
- Cash: the most common route. The balance is paid on handover and the title deed is issued in your name at the DLD.
- Mortgage: the balance on handover can be financed with a mortgage from a Dubai bank; for the conditions for foreigners see our Can I buy a home in Dubai with a mortgage page.
- Post-handover plan: if the project offers one, the balance is paid in instalments after handover and the flat can be let in the meantime.
What to watch for
- Missing instalments: if a buyer does not pay, Dubai law allows the developer, after a notice process, to terminate the contract and keep part of the amount paid depending on how far construction has progressed. Choose an instalment schedule that fits your cash flow.
- Post-handover plans can be priced in: long plans are interest-free, but the developer may build that flexibility into the price. Ask whether the same project offers a discount for paying in full.
- Golden Visa on a flat bought in instalments: for the AED 2 million threshold, the amount paid on an off-plan purchase also matters; for the current requirements see our Residency in Dubai by buying property page.
- Selling before handover: some developers require a set share of the price (usually 30% to 40%) to have been paid before the flat can be transferred ahead of handover.
- Currency: the dirham is pegged to the US dollar; if you pay the instalments from Turkish lira or euros, your currency risk is dollar risk. For how to send the money see our money transfer for a home abroad page.
Frequently asked questions
Can you buy a home in Dubai in instalments? Yes. Off-plan homes can be bought in instalments on the developer’s interest-free payment plan; usually 10% to 20% of the price is paid on reservation.
Do Dubai payment plans charge interest? Developer payment plans are interest-free. Interest only arises if you finance the balance on handover with a bank mortgage.
What does a 60/40 payment plan mean? 60% of the price is paid before handover (reservation and construction instalments) and 40% on handover. 70/30 and 50/50 plans work the same way.
What is a post-handover payment plan? A plan in which part of the price is paid after you receive the keys, usually over two to five years. During this time the flat can be let and the instalments partly paid from the rent.
Do you need proof of income to buy in instalments? Developer payment plans usually do not require proof of income. A passport and the reservation payment are enough, though documents on the source of funds may be requested.
What happens if I cannot pay my instalments? After a notice process the developer can terminate the contract and keep part of the amount paid depending on how far construction has progressed. It is important to choose a schedule that fits your cash flow.
Related pages
Property in Dubai, Will house prices fall in Dubai and Dubai or Greece.
Sources
Escrow and off-plan sale rules are based on Dubai Law No. 8 of 2007 on escrow accounts and Law No. 13 of 2008 on the interim property register, as amended; for the DLD fee see the Dubai Land Department. Plan types reflect common practice in Dubai; the example schedule is indicative and every project’s plan is different.
Legal notice
capital.works® (YATIRIM UK LIMITED) is a real estate advisory company; it does not provide legal or tax advice. The payment plan, sale agreement and DLD registration are made on the developer’s documents. Examples are indicative; every project’s payment plan is different and should be confirmed in writing before signing.
The next step
Tell us your budget and how much you can pay in instalments, and we will send projects whose payment plans fit your cash flow, with their schedules including the amount due on reservation: Contact us.