Off Plan flipping is a practice of buying real estate, usually during it's early stages of development or construction typically before the project is completed.
The idea behind it is selling them for a good profit after they are completed, as a lucrative opportunity. The main goal is to capitalize on the potential appreciation of that property value as the development starts to progress. Therefore, the value of the completed project has significantly risen by the time it's done. It is a way for the investor to make profit and reimburse the money they had invested at the sametime.
This practice is more common in growing real estate markets where the economy is stable and laws are favorable, and the value of the property is likely to increase after construction such as Dubai. However, it’s not as simple as it may sound, and needs meticulous planning and execution:
Research and Market Analysis
First and foremost step is to have an in-depth knowledge of the market, in this case Dubai market with current trends and potential pitfalls. Research developers, projects and locations that have a solid history of appreciation.
Determine Budget
Outlining your budget for the off plan properties you're interested in. Carefully research options of interest, mortgage and installments, and see what fits your finances well.
Choosing the right project
A crucial decision would be choosing the most suitable upcoming project. There's no way of being able to predict exact results, but selecting projects in prime locations with greater demand and esteemed developers that are known for de;ivering great developments in the past. Furthermore, try to analyze the amenities, type of project and neighborhood for potential future prospects.
Due diligence and Networking
Review the developer's record and stability, and understand all the nitty grittys of the legal aspect to make a sensible decision. Furthermore, connect with real estate agents, industry professionals and other investors, which will aid you in staying updated within the community.
Marketing and Selling
Developing a marketing strategy, as the property starts to reach completion. Depending on the trends and best ways to target and reach the right audience with the help of online marketing, real estate agents/ agencies or by personal networking.
Evaluation and Considerations
Evaluating returns and calculating potential profits by comparing purchasing price and selling costs to understand how effective your off plan flipping is. Moreover having a deep understanding of the legal implications, factoring in potential market fluctuations and risks, along with determining when to sell. All of these can be sorted in a simpler manner by consulting experts.