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Can you Mortgage Off-plan properties in Dubai?

Posted by adee on August 22, 2023


Off-plan property transactions have seen a massive spike in the last 2 years. With a huge influx of international investors, rising prices amidst this property boom, lots of investors and first-time home buyers/investors have started choosing off-plan properties as the way to go.

And why wouldn’t they?

Buying an off-plan property has always been a good idea, as it brings you the best capital appreciation once it’s completed, the property price is usually lower, and the payment plans are flexible.

It has allowed buyers who previously wouldn’t be able to enter the market to not only do so but get amazing deals on types of properties they never dreamt of.

Despite the popularity of off-plan mortgages, buyers don’t have a clear idea of the regulations regarding mortgages for off-plan properties. Most people will tell you it’s not possible or that it’s complicated.

So can you really mortgage an off-plan property?

The short answer?


You CAN get a mortgage for an Off-plan property in Dubai.


There are certain qualifying conditions that need to be met before you can get a mortgage for an off-plan property.

In this article you’ll be able to understand what are the different types of mortgage available for an off-plan property in Dubai, what are the different requirements that need to be met in order to qualify for a mortgage, and is it worth doing so.

Types of off-plan mortgage in Dubai

There are two main types of mortgages available for off-plan properties in Dubai: construction finance and post-completion finance.

1. Construction Finance:

Construction finance is a loan that is used to pay during the construction of the property.

As someone buying a ready property on mortgage, the maximum amount of loan that you can get from the bank is 80% of the total value of the property.

This is called the “Loan to value ratio” or LVR for short.

The maximum value LVR for a ready property in Dubai is 80%

This means for example if you are buying a ready property worth 1 Million, and you take a mortgage the maximum the bank will lend you will be 80% of 1,000,000 which is 800,000. The rest 200,000 has to be paid in cash by you.

When it comes to off-plan properties, banks in Dubai will only lend up to 50% of the property’s price, regardless of its value. The remaining 50% must be paid by the buyer in cash.

The LVR for an off-plan property is 50%

So if you are buying an off-plan property worth 1 Million and want to get a mortgage, the maximum a bank will lend you will be 50% of 1,000,000 that is 500,000. The remaining 500,000 must be paid in cash.

It is also important to note that this 50% financing is only available AFTER the buyer has paid 50% or more of the property’s price. This means that buyers must have at least 50% of the purchase price in cash before they can apply for a mortgage.

Another important point to remember is that not all banks in Dubai offer financing for off-plan properties, and those that do often prioritize projects by established developers.

However, there are occasional exceptions for select private developer projects.

2. Post-completion finance:

Post-completion finance is a loan that is used to pay after the construction of a property.

Most off-plan projects have payment plans that have a payment due on handover or once it’s completed.

This could be a post hand-over payment plan where you get anywhere between a few months to a few years to pay the remaining amount.

This payment can be mortgaged and is usually referred to as post-construction finance.

When you mortgage a property that is being handed over or is completed, the same mortgage laws apply as a regular mortgage.

Since the property is now ready your LVR will be 80%

Let’s say you bought an off-plan property worth 1 million dirhams. You paid 70% of the price during construction, which is 700,000 dirhams. Now that the property is ready, you need to pay the remaining 30%, which is 300,000 dirhams.

You can get a mortgage from the bank to cover the remaining amount. The maximum loan-to-value ratio for ready properties is 80%, but since you’ve already paid 70%, you can get a mortgage for the full 30%.

You can also release equity from your property to borrow more money for other things, such as a down payment on another property.

In the example above, you’ve already paid 70% of the property’s value and taken out a mortgage for the remaining 30%.

However, you’re still allowed to borrow up to 80% of the property’s value. This means you can get an additional 50% (500,000 dirhams) in cash from the bank by giving up equity in the property.

– Can I still sell if I have a mortgage on my off plan property?

Having a mortgage on your off-plan property doesn’t prevent you from selling it. Although a mortgage involves banks and adds complexity, it’s not a major obstacle.

The selling process might be slightly different, but it remains manageable and does not complicate matters greatly.

– Do I still get a Payment Plan if I mortgage an off-plan property?

No if you mortgage an off-plan property, you cannot make use of the lucrative payment plans as you already are paying 50% of the property’s price and the rest is paid fully by the bank.

– Which banks will finance an off plan property purchase?

Unlike getting a mortgage for a ready property where buyers can more or less use any bank to get a mortgage, the options are smaller when it comes to getting a mortgage for an off plan property.

Please note that not all developers and projects are eligible. Additionally, every bank has its own approved developer and project list, and not all banks offer finance for off-plan projects.

Usually banks approve mortgages for off-plan projects by Master Developers, like Emaar Properties and Dubai Properties. They have a good track record, and are reputable in the industry giving the banks confidence in approving mortgages.

Occasionally they do approve mortgages from select private developers but that depends on various factors and it’s best to speak to your bank regarding the developer you’re buying from.

– Qualifying for an off plan property mortgage

Qualifying for an off plan property mortgage is in no way different from being approved for a ready property. Assuming the developer is on the approved list of developers for whom the bank will provide a mortgage, the assessment of the buyer will be almost the same as it would with a ready property.

However, there may be some additional requirements that could apply, such as a higher credit score and a larger down payment (50%).

Much like a regular mortgage the criteria for qualifications for an off-plan mortgage will differ from bank to bank.

There is no difference other than as mentioned before you have to pay 50% of the value of the off-plan property rather than the 20% you would pay for a ready property.

– What is the Interest Rate Payable?

The interest rate payable is determined by the official interest rates set by the UAE central bank. Different banks do offer different rates on certain loan types so it is better to speak to a professional to find the best rates available in the market.

– Risk associated with getting a mortgage

If you require a mortgage to complete the purchase, you must consider that your financial circumstances may change.

Losing your job, increased interest rates or changes in bank lending policies may impact your ability to get a mortgage in the future.

Essentially, though you may qualify for a loan now, you may find yourself in a position later where the bank will not lend you the funds to complete your purchase.

However, this risk can be mitigated.

We recommend talking to a qualified mortgage advisor before you put down your booking fee to understand all your options.


Buying an off-plan property can be a good way to get a good deal on a property, but it is important to be aware of the risks involved. If you are considering buying an off-plan property, be sure to do your research and talk to a mortgage lender to find out what your options are.

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