Dubai Off-Plan: Real Property or Pure Hype?

**Tim Elliott** (0:00)
It's the Morning Drive, real estate next. And if you've been looking to buy off-plan property in Dubai recently, you're very likely to have encountered the following acronym, EOI, or expression of interest. And what it's supposed to be is your ticket to the front of the line. But for a lot of people, it turns into maybe a waiting game for a refund, and some frustration that goes along with waiting for refunds as well. So is it a legitimate tool for securing your dream home, or is it just a sophisticated way for developers to gauge market hype? There's a question. We'll investigate the answer with Ajay Menon, who is the CEO of Luxe Vista Real Estate. Good to see you.

**Ajay Menon** (0:45)
Good to see you, Tim.

**Tim Elliott** (0:47)
Good morning. Let's start with the basics, Ajay. What is an EOI? And why has it become like the default gatekeeper for new project launches?

**Ajay Menon** (1:00)
EOI is expression of interest.

**Tim Elliott** (1:03)
Right.

**Ajay Menon** (1:03)
Right. And basically, it is nothing but submitting a few documents about explaining who you are, what you are, which unit you like, what are your preferences. And that you need to submit to the developer along with a payment, which could be a check payment link, where you can use your credit card and add points or bank transfer.

**Tim Elliott** (1:27)
Okay.

**Ajay Menon** (1:28)
It does not mean that you are guaranteed an option, that you are not guaranteed an allocation. It is not an SPA. It is not booking. It's nothing.
It's just wait and then wait for your turn.

**Tim Elliott** (1:43)
Okay. So it doesn't mean you're going to even get a unit.

**Ajay Menon** (1:49)
No.

**Tim Elliott** (1:51)
And yet you have to pay how much?

**Ajay Menon** (1:54)
It can go from 50,000 dirhams all the way to 10% of the unit value.

**Tim Elliott** (2:00)
Okay. So why is it needed?
What are the benefits to the investors?

**Ajay Menon** (2:06)
See, the idea is you get priority access. You are in the game or you are not in the game.

**Tim Elliott** (2:13)
Okay.

**Ajay Menon** (2:13)
That's the basic of it.
And when you say you are in the game, basically you get pre-launched prices. You get access to premium units, the ones with the best views.
And you also are in priority line.

**Tim Elliott** (2:29)
Right. Okay. So that's kind of a developer narrative, I suppose. Right. So if you look behind the curtain there, developers are holding all the cards, aren't they?

**Ajay Menon** (2:41)
Yes. And that is the secret that most people don't understand.

**Tim Elliott** (2:46)
Right.

**Ajay Menon** (2:46)
See, the thing is, for the developer, it is the real-time marketing intel, right?

**Tim Elliott** (2:51)
Okay. Well, yeah, that makes sense. Okay. Okay. So the marketing intel that you're paying for.

**Ajay Menon** (2:56)
Yeah, exactly. So they understand which units are preferred, which views are preferred, what flow plan is better. Because every developer, every project has, for one bedroom, they might have two or three different flow plans.
So they get an understanding of, okay, this is what the people like.

**Tim Elliott** (3:16)
Okay. So if you're launching the first phase of a development, for example, it would influence the next phase.

**Ajay Menon** (3:24)
The next phase.

**Tim Elliott** (3:25)
Right. Right.
Okay, then what else does it offer developers?

**Ajay Menon** (3:30)
Okay. Then they can also price it slightly higher. So they also understand how they have priced it. So for example, at the EOS stage, if they receive 3,000 EOS for just 500 units of inventory, that means they can kind of gauge whether it is fairly priced or underpriced.

**Tim Elliott** (3:51)
Right.

**Ajay Menon** (3:52)
And normally what happens is like they normally give a price range during the EOS stage. The brochures are not out.
The brochures are not out at this moment. So the idea, general idea is they will give you some kind of location. They will give you, this is the price range for one bedroom to two bedroom to three bedroom, and they give a price range. It's like it could start from 1 million all the way to 1.3 million.

**Tim Elliott** (4:15)
Okay. So this literally is just to be in the game.

**Ajay Menon** (4:18)
In the game, yeah.

**Tim Elliott** (4:19)
Right. So it's like a fee to be in the game. But it's an assurance of nothing. Aside from you will get a refund. Nobody's saying the money's been taken. There is a refund, but it's down the road at some point.

**Ajay Menon** (4:29)