How Distress Deals Work in the Off-Plan Secondary Market — And Why Experience Matters

In Dubai’s real estate market, not all opportunities are visible at first glance. Some of the most attractive deals are found in the secondary off-plan market, specifically through what are known as distress deals. Understanding how they work—and knowing how to execute them correctly—can make a substantial difference in both risk and return.

What Is a Distress Deal in the Off-Plan Market?

A distress deal occurs when an original buyer of an off-plan property needs to exit their position before completion, often due to:

• Liquidity constraints

• Changes in personal or financial circumstances

• Inability to continue with the payment plan

• Portfolio rebalancing

As a result, the seller may be willing to transfer the unit below current market value, sometimes even below the original purchase price, especially if a significant portion has already been paid to the developer.

These opportunities exist exclusively in the secondary market and are rarely advertised publicly.

Why Distress Deals Can Be Highly Attractive

When structured correctly, a distress deal can offer:

• Immediate equity below today’s market prices

• Lower capital exposure compared to buying a brand-new off-plan unit

• Shorter time to handover, reducing market and construction risk

• Stronger exit or rental potential upon completion

However, these advantages only materialize if the transaction is analyzed and executed properly.

The Hidden Complexity Behind Distress Deals

Despite their appeal, distress deals are not straightforward transactions. Each case is different and may involve:

• Developer approval for resale and transfer

• Outstanding payment schedules and penalties

• Transfer fees and NOCs

• Title structure, SPA clauses, and assignment conditions

• Risk of mispricing if market data is misunderstood

An apparent “cheap price” can quickly turn into a poor investment if these elements are not carefully reviewed.

Why an Experienced Agent Is Critical

This is where experience becomes decisive.

A seasoned agent does not simply “find a cheap unit.” They:

• Validate the real discount versus current and future market value

• Stress-test the deal against handover prices and rental yields

• Negotiate directly with sellers under pressure without exposing the buyer

• Coordinate with developers, trustees, and legal teams to avoid execution risk

• Protect the buyer from hidden liabilities that are common in distressed resales

In many cases, the best distress opportunities never reach public portals and circulate only within trusted professional networks.

Distress Deals Are Not for Everyone — But They Are Powerful

Distress deals are not a mass-market product. They are best suited for:

• Investors seeking asymmetric risk-reward

• Buyers who understand timing, liquidity, and exit strategies

• Clients who value execution certainty over hype

When done correctly, they can outperform traditional off-plan purchases. When done poorly, they can erase the perceived discount entirely.

Our Approach at Di Salvo Realty

At Di Salvo Realty, we treat distress deals as a strategic investment instrument, not as opportunistic sales. Each opportunity is filtered through:

• Real market comparables

• Developer-specific resale rules

• Payment plan analysis

• Exit and yield scenarios

Our role is not to sell “cheap deals,” but to identify mispriced risk and turn it into long-term value for our clients.

In a market as dynamic as Dubai, experience is not optional—it is the edge.