Flipping of off plans disappear while flipping in land transfer active

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By Fakhr Ahmad:
Flipping in the residential off plans has virtually disappeared as developers are now asking high payments beyond down payments before selling units. However, flipping in land transactions going on in full speed.
In the past investors used to place 10-20 per cent down payment and after a year or so flip it over to another buyer before the completion of the unit.
Now developers are asking 30-50 payment before flipping to the next buyer. In addition, buyer have to pay 4 per cent Oqood to Dubali Land Department for transfer of the property to their name.
In contrast, when it comes to commercial land, there is a lot of flipping happening as prices have rocketed by around 300 per cent in the past couple of years.
“As far as demand for residential units is concerned, whether you’re buying under Dh1 million or Dh10 million property, we don’t have a traces of flipping because 90 per cent of the market is controlled by top 15 developers. And reselling of the property by these developers is not allowed until you pay 30 per cent to 50 per cent, depending on the developer. Secondly, in most cases, there is an accelerated payment also. In my opinion, 90 per cent of the people don’t have any intention of flipping,” said Imran Farooq, CEO of Samana Developers.
“As far flipping is concerned, the majority of the action is happening in lands, where we have seen 300 per cent appreciation in the last 24 months. That is where active buying and selling is taking place and that is not an end-user item anymore. Commercial land, which was worth Dh20 million two years back, is where the majority of the speculators have stepped in. Limited speculation is happening with flippers in townhouses but that activity is very small. So flipping has moved from residential to commercial plots,” Farooq told Khaleej Times in an interview.
Angelika Egoschin, founder of Real Estate Blondies, also told Khaleej Times, reported by Zawaya, that flipping doesn’t exist due to property developers mandating buyers not to sell before paying up to 50 per cent of the unit’s price.

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