Purchasing a property with DAMAC in Dubai offers a range of financing options that make it easier for both first-time buyers and seasoned investors to own a luxurious property. DAMAC’s flexible payment plans and mortgage options allow you to choose the best path according to your budget, goals, and financial situation. Here’s a breakdown of how to finance your DAMAC property purchase, covering DAMAC projects in Dubai, payment structures, and mortgage tips.
Overview of DAMAC Payment Plans
1. Off-Plan Installment Plans (Milestone Plans)
Most DAMAC off-plan projects in Dubai are sold with milestone-based payment plans. These are structured to ensure payments are made in stages as the property is built. Typically, you’ll make a 10-20% deposit at the time of booking, then follow up with regular instalments, which can range from 5-10% every few months during construction. The final balance is usually paid at handover.
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Example: In a DAMAC Hills villa, you might pay 20% at booking, followed by small payments of 5% every 3 months during the construction period. The balance is then due upon the completion of the property.
These payment schedules are interest-free and are spread out over the construction period, giving you time to pay while the property is being built.
2. Post-Handover Payment Plans
If you prefer to pay after moving into the property, DAMAC also offers post-handover payment plans. Under this option, a larger portion of the cost is deferred until after the property is handed over. Typically, you might pay 20-30% as a down payment, another 40-50% during the construction phase, and the remaining 20-40% after the property is handed over (over 2-5 years). This option is great for those who want to move into the property before the final payments are made.
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Example: In a DAMAC Lagoons townhouse, you might pay 30% before handover and the remaining 70% after moving in, spread out over several years.
3. Milestone vs 1% Plans
Some projects also offer a 1% monthly payment plan. In this plan, you pay 1% of the property price each month following the booking deposit. This is ideal if you prefer smaller, consistent payments instead of larger instalments, and it helps manage cash flow over a longer period.
Payment Plans by Project
DAMAC’s payment plans can vary by project. Here are examples of how payment plans work across different DAMAC projects in Dubai:
DAMAC Hills
DAMAC Hills offers a 60/40 payment plan, where 40% is paid during construction, and the remaining 60% is due at handover. This makes it easier for buyers to manage their finances as they can spread out the cost while the property is being built. DAMAC Hills 2, for instance, may also offer a 50/50 plan, which is a similar structure but with smaller installments.
DAMAC Lagoons
DAMAC Lagoons uses milestone-based payment plans as well. A townhouse in this community might be offered with a 20% down payment, then smaller payments every few months during construction, and the remaining balance paid post-handover. The advantage of the post-handover payment plans here is the flexibility, as you can start paying off the remaining balance after moving in, often over several years.
Safa One by DAMAC
For more luxurious developments like Safa One, the payment plan might be 75/25, where 75% is paid before handover, and 25% is paid after. These types of projects typically require higher upfront payments but offer the benefit of immediate ownership, allowing you to access your property sooner.
Mortgage Options for DAMAC Buyers
In addition to DAMAC’s in-house payment plans, many buyers may opt for a mortgage to finance their property purchase. While DAMAC’s plans are interest-free, a mortgage can help spread the cost over a longer period, with interest rates typically in the 3-5% range. Mortgages for completed properties in Dubai usually offer up to 80% financing for residents and 50-60% for non-residents.
Here’s how it works:
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Residents can generally get up to 80% financing from UAE banks, while non-residents are typically offered 50-60% loan-to-value (LTV).
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Mortgage Tenure: Most banks offer mortgage terms of up to 25 years, making it affordable for those who have steady incomes but need longer to repay.
Although mortgages are commonly available for ready (completed) properties, buying off-plan properties used to be more challenging in Dubai. However, in recent years, DAMAC has partnered with banks like ADIB (Abu Dhabi Islamic Bank) to offer mortgages for off-plan purchases. This partnership allows UAE residents to secure financing for off-plan DAMAC projects in Dubai as long as the property is at least 35% completed. This development makes it easier for buyers to combine DAMAC’s payment plans with a bank loan.
Choosing Between a Payment Plan and a Mortgage
Deciding whether to use a payment plan or a mortgage depends on your financial situation and goals.
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For First-Time Buyers: If you’re new to the property market, a DAMAC payment plan can help ease the financial burden. The ability to pay over time with a low initial deposit is particularly appealing for those with limited savings but steady income.
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For Investors: If you’re purchasing for investment purposes, a mortgage might allow you to retain liquidity and invest elsewhere. However, post-handover payment plans are an excellent choice if you’re looking to rent out the property before completing the payments.
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Cash Flow Considerations: Payment plans, especially the 1% monthly plan, allow you to manage your cash flow by paying small amounts monthly. If you prefer longer-term stability, a mortgage with a fixed rate may provide more peace of mind.
If you’re able to make a larger down payment and don’t mind paying monthly instalments with interest, a mortgage offers the advantage of owning the property outright right away. Alternatively, if you have limited upfront funds but want to avoid paying interest, a DAMAC payment plan might be the best choice.
Conclusion
Choosing between DAMAC payment plans and a mortgage depends on your individual circumstances. Both options have their advantages, but what’s important is finding a solution that fits your budget, timeline, and financial goals. Whether you’re looking at DAMAC Hills, DAMAC Lagoons, or other DAMAC projects in Dubai, there are plenty of flexible financing options to choose from.
For those new to the Dubai property market, or those looking to invest in a growing real estate market, DAMAC’s payment plans offer the flexibility needed to secure your dream home without financial strain. Consider your goals, do the math, and reach out to DAMAC’s sales team or a mortgage advisor for guidance to make the best decision for your property purchase.
Sources: Official DAMAC plan outlines and Dubai market guidesdamacdubai.properties ADIB press release and news zawya.com. Property experts on payment vs mortgage olivebranchdubai.com, propertyfinder.ae. These together inform the advice above.
