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In 2024, the new payment plan for property purchases becomes particularly popular. The "1% per month" approach has now penetrated even the villa segment. This payment option proves to be much more attractive compared to conventional offers involving payments of 10-20% every 3 months. The new plan allows acquiring property in Dubai by paying only 1% of the total cost each month. This reduces initial contributions, alleviates the pressure of high mortgage interest rates, and minimises commissions.
One cannot forget the colossal impact that high interest rates and stringent requirements for mortgage loans currently have on buyer demand. At present, the interest rate on loans has already exceeded 5%. Additionally, one must consider the property prices, which have risen by 15-30% in recent years. People are actively searching for alternative offers, and the 1% plan allows them to plan their expenses and financial commitments more effectively. However, the new plan becomes a necessity for developers as well.
With the beginning of 2024, new regulations were introduced for developers and their projects. Unsold housing units, after a certain period, are now subject to corporate income tax. This requires careful management on the part of developers. It also motivates developers to find ways to stimulate sales. Therefore, with the new payment plans, we also see a reduction in the sizes of initial contributions, sometimes down to 5%. Sales timelines have become as crucial a factor in the business as the actual realisation of the product. In 2024, companies with a reliable reputation for meeting project delivery deadlines will be among the leaders.
