Types of Payment Plans in Real Estate: A Complete Guide

What is a Payment Plan? 

When purchasing real estate in Dubai, some buyers opt to buy the property outright in cash. But, for many, this is not possible due to the large amount of savings that it requires. For this reason, real estate developers in Dubai offer payment plans.

A payment plan is a method of purchasing an off-plan property in Dubai, which divides the property's cost into instalments which are paid according to an agreed-upon schedule.

This approach is ideal for buyers who wish to own property but prefer not to pay a large lump sum upfront. Payment plans are typically agreed between the developer and buyer, with instalments often linked to predefined dates or construction milestones.

Types of Payment Plans for Real Estate

While there are various kinds of plans, these are some of the most popular property payment plans in Dubai. For context, this guide focuses on off-plan real estate payment plans, and all pricing references are in AED.

Structured Payment Plan

Summary: A structured payment plan splits the property price into a down payment, construction instalments, and a final handover payment.

Structured payment plans are one of the most popular options for buying off-plan property in Dubai. Under this model, a predetermined schedule is agreed upon between the developer and the buyer, with payments made at various stages throughout construction and a final payment upon handover (when the property is finished).

Structured payment plans are usually split into three stages:

• An initial down payment paid when booking the property

• Regular instalments throughout the construction period

• A final payment at handover

These plans are typically expressed as a ratio, such as 50:50, 40:60, or 60:40, indicating the proportion of the purchase price due during construction vs. at handover. For example, in a 40:60 plan, the buyer pays 40% during construction and 60% at completion.

Post-Handover Payment Plans

Summary: A post-handover payment plan allows buyers to continue paying for a property after construction is complete.

This is also a highly popular property payment plan in Dubai. Post-handover payment plans allow buyers to make some of the payments for a property after handover has taken place.

Typically, the buyer pays a down payment and a percentage of the total price during construction, with the remaining balance spread over a defined period after handover.

For example, if a payment plan offers “three years post-handover”, it usually means a portion is paid during construction, with the remainder divided into instalments over the three years following handover.

Post-handover plans provide significant advantages. For end-users, they make property ownership more affordable by reducing upfront financial pressure. For investors, these plans allow rental income to cover post-handover instalments, easing cash flow and reducing the need for large capital at the start.

However, post-handover plans are available only for selected projects, and many major developers do not offer them. Careful research is essential to ensure a project offering a post-handover plan still represents a strong investment in terms of pricing, location, and long-term value.

1% Monthly Payment Plan

Summary: A 1% monthly payment plan lets buyers pay 1% of the property value each month after an initial down payment.

A 1% monthly payment plan allows buyers to pay for an off-plan property with an initial down payment followed by fixed monthly instalments of 1% of the property’s value. This structure spreads payments over several years, making property ownership more manageable without a large upfront cost.

For example, a project might offer a plan where the buyer pays 20% upfront, followed by 1% monthly for 80 months until the full amount is paid.

While these plans may increase accessibility, it is important to assess the project’s quality, developer reputation, pricing, and location to ensure the investment is financially sound long term.

10:90 Payment Plan

Summary: In a 10:90 payment plan, buyers pay 10% upfront and the remaining 90% at property handover.

In a 10:90 payment plan, the buyer pays 10% upfront and 90% at the time of handover. This structure significantly reduces the initial financial commitment, enabling buyers to reserve a property with minimal capital and pay the majority closer to completion.

These plans are commonly offered for off-plan properties and appeal to buyers seeking maximum financial flexibility during construction.

Because most of the payment is due at handover, it is crucial to assess the developer’s financial strength and track record, as they must be capable of completing construction without relying heavily on ongoing instalments.

Rent-to-Own Plan (Not Commonly Used in Dubai)

Summary: Rent-to-own plans allow buyers to rent a property first, with rental payments contributing toward ownership — however, this model is extremely rare in Dubai.

Rent-to-own payment plans allow buyers to rent a property for a fixed period, with part of the rent contributing toward the eventual purchase price. The buyer and developer agree on terms such as the rental period, payment schedule, and purchase price, usually documented in a Sales and Purchase Agreement (SPA). A down payment is generally required, but it is often lower than traditional financing.

However, rent-to-own is not a widely available or mainstream option in Dubai in 2025. Only a limited number of developers have offered this structure in the past, and most buyers today achieve similar flexibility through post-handover payment plans, off-plan purchases, or mortgage financing.

For most buyers, more practical and accessible alternatives exist that provide similar benefits with clearer legal protection and faster ownership.

Benefits of Payment Plans for Real Estate Buyers

There are several advantages to using property payment plans in Dubai when purchasing real estate, particularly for off-plan properties.

How to Choose the Right Payment Plan for Your Needs

While there are various property payment plans in Dubai, choosing the right structure depends on your financial position and long-term goals. Consider the following factors before committing to a plan:

When evaluating real estate payment plans, always ensure the structure aligns with your lifestyle, investment objective, and cash flow. If you are unsure, a RERA-licensed advisor can help compare multiple plans across different developers so you can secure the most suitable option.

Tips for Securing the Best Payment Terms

When exploring property payment plans in Dubai, it's important to compare options and negotiate the best terms where possible. This can be done through careful research, confident communication and partnering with an experienced real estate broker.

Can You Negotiate a Property Payment Plan in Dubai?

While negotiation is possible in some cases, it is important to understand that payment plans are not always flexible, especially for high-demand off-plan projects launched by Dubai’s leading developers. These developers typically offer fixed, non-negotiable payment structures due to strong demand and fast sell-out rates.

However, negotiation may be possible in the following scenarios:

• Boutique or lesser-known developers looking to attract buyers

• Projects in early launch phases where inventory is still available

• Slower-moving inventories or units with unique layouts, floors, or views

In such cases, buyers may be able to negotiate elements such as down payment percentages, post-handover duration, service charge waivers, or minor price adjustments.

For most premium launches, negotiation is less about changing the payment plan itself and more about securing added value, incentives, or preferred unit selection. Working with an experienced, RERA-licensed advisor gives you visibility across multiple developers, helping you identify where negotiation is realistic and where a fixed structure is still a strong offer based on market demand.

Conclusion

Selecting the right property payment plan in Dubai is an important part of making a smart and sustainable real estate investment. Whether you choose a structured milestone plan, a post-handover payment plan, or a 1% monthly option, the right structure can make property ownership more accessible, reduce upfront pressure, and support long-term financial planning.

Each payment plan offers different advantages, from financial flexibility and interest-free instalments to easier cash-flow management. However, it is equally important to assess the developer’s track record, project quality, pricing, and any additional fees before committing. Understanding these factors ensures that the payment plan supports both your short-term affordability and your long-term property goals.

For buyers considering an off-plan purchase, partnering with an experienced, RERA-licensed real estate advisor provides valuable guidance when comparing payment plans, negotiating terms where possible, and ensuring the option you choose aligns with your financial strategy. With the right plan and expert support, a well-structured payment plan can be a powerful path to property ownership and long-term growth in one of the world’s most dynamic real estate markets.