Is Buying Off Plan Worth It?
Written by: Marcus M. Araz, MBA, PhD · Updated:
It makes sense if you want to spread payments, a new home warranty and a lower entry price; not if you plan to sell at handover for a quick profit. Buying off plan means buying a home while it is still being built. It works differently in each of our three markets: in the UK, contracts are exchanged with a 10% deposit; in Dubai, payments go into the project’s DLD-registered escrow account; in Greece, handover on conversion projects depends on the permit timetable. The main risk is not price but timing: handover can be delayed and the market at handover may differ from today’s.
The advantages of buying off plan
- Payments are spread: in Dubai 10% to 20% of the price is paid on reservation and the rest during construction and at handover; in the UK 10% on exchange and the balance at completion. More on our Buying in Dubai in instalments page.
- Entry price: prices in early phases usually open below those of completed flats.
- First choice: early buyers get to choose the floor, aspect and layout.
- New home warranty: in the UK, new homes are delivered with a 10 year warranty from bodies such as NHBC, Premier Guarantee or LABC.
- Low maintenance and energy costs: a new building costs little to maintain in the early years and is energy efficient, which makes it easier to let.
Risks
- Late handover: the most common problem. The contract should state the handover date and what happens if it slips.
- Markets move: prices at handover may be lower than today. The heavy 2026 and 2027 handover wave in Dubai is a current example; more on our Will house prices fall in Dubai page.
- Mortgage timing: UK mortgage offers are usually valid for a limited period; if handover slips you may have to reapply on the conditions of that day.
- Service charge surprises: the service charge is only confirmed at handover; budget on the real figures of comparable projects, not the developer’s estimate.
- Selling at handover can be harder: if many flats in the same project come to market at once, prices come under pressure.
How buying off plan works in our three markets
| England | Dubai | Greece | |
|---|---|---|---|
| First payment | Reservation fee, then 10% on exchange of contracts | 10% to 20% on reservation plus the DLD fee | A deposit on the preliminary contract; 10% to 30% depending on the project |
| How payments are protected | Contracts are exchanged between solicitors and the deposit sits in the solicitor’s client account | Payments go to the project’s DLD-registered escrow account | Payment is supervised by the lawyer and the title passes before a notary |
| Registration | Title registered at completion (HM Land Registry) | The off-plan contract is recorded in the DLD system through Oqood | Transfer and land registry entry at handover |
| Warranty | 10 year new home warranty | The developer’s defect liability and structural warranty | The permit and engineer’s report on conversion projects |
| Balance | All of it at completion | At handover or in instalments afterwards, depending on the plan | On the final contract |
What to check before deciding
- The developer’s delivery record: how many projects it has delivered and whether there were delays. The developers in our portfolio hold the registrations described on our firm selection page .
- Contract terms: handover date, compensation for delay, the right to change the layout, refund terms.
- Total cost: the taxes and costs on top of the price differ by country; see our costs when buying abroad .
- Exit plan: do you plan to sell at handover or to let? Most developers allow transfer before handover only once a set share of the price is paid.
- Rent expectations: calculate the yield from current rental listings in the same area, not from the brochure; figures by city are on our rental yield page.
Frequently asked questions
What does off plan mean? It means buying a home that is still under construction, at project stage. Payment is usually spread across the build.
Is buying off plan risky? The main risks are late handover and market conditions at handover. In Dubai payments are held in escrow and in the UK new homes come with a 10 year warranty; these rules reduce risk but do not remove market risk.
Is buying off plan cheaper? Entry prices usually open lower in early phases and payments are spread. But with a completed flat the price is known today and the rent starts immediately.
Can an off-plan flat be sold before handover? With most developers, transfer is possible once a set share of the price is paid; in Dubai this is usually 30% to 40%. Check the condition in your contract.
What happens if handover is late? The delay clause in the contract decides. Some contracts give compensation or a right to withdraw after a set period, so have your lawyer review the contract.
Can you use a mortgage when buying off plan? Yes. In the UK the offer is timed to the completion date; in Dubai the balance at handover can be financed. The conditions are on our mortgage rates page.
Related pages
Buying property in the UK, Property in Dubai and What you need to buy in Greece.
Sources
Off-plan sale and escrow rules in Dubai are based on Dubai Laws No. 8 of 2007 and No. 13 of 2008; the UK new home warranty on the programmes of NHBC and similar bodies. Payment and handover terms vary by project; the sale contract is what binds.
Legal notice
capital.works® (YATIRIM UK LIMITED) is a real estate advisory company; it does not provide legal or tax advice. The title and contract process is carried out by a solicitor registered in the UK. On the mortgage side, our FCA authorisation applies (FRN 1049015, authorised credit broker).
The next step
Tell us which country and handover date you are looking at, and we will send off-plan and completed projects side by side with payment plans, total costs and rent expectations: Contact us.