Off Plan vs. Ready Property Which is the best

There are two schools of thought regarding real estate investments: either you should go with immediate lesser profit cash flow, bet on future market price, or invest in off-plan rather than ready property.

Both strategies have advantages and disadvantages that the investor must weigh. Thus there is no clear winner in this ongoing discussion.

Let’s start by defining these phrases so that we’re all on the same page:

Pre-construction housing: A property being sold “off plan” has not yet had a building put on it. To get more favorable financing conditions from lenders, pre-constructions are often advertised to real estate developers and early adopters as projects.

The term “ready property” is used to describe a home that is available for immediate usage. If a property is in this state, it is complete and satisfies all municipal regulations.

 

Now that we have a shared definition of both let’s talk about the three major categories of property investors. It’s crucial to recognize your place among these groups.

Buying to flip the finished product.

Rental investment after purchase of a property.

Buying to live on the property.

 

Knowing what kind of customer you simplifying this discussion. For instance, if you move into the home you’re buying, you’ll want to look for one already prepared for occupancy. Otherwise, if you sell or rent the house, consider purchasing an off-plan property since you will pay less than the full market value and will spread out your payments over a longer time.

The time value of money (TVM) is another concept that needs to be grasped before we can begin our comparison. TVM refers to the idea that money in the present is worth more than the same amount in the future because of the interest it could earn. However, the profit you make on an off -plan properties in dubai will almost always exceed that on a finished house.  

Let’s break down each possibility, but be consistent by maintaining constants like property type, size, and price.