Payment plans decoded: 60/40, 80/20, post-handover, 1% monthly

The payment plan is half the reason people buy off-plan — you pay for the property in slices while it's being built. But the shape of the plan changes your risk more than most buyers realize. Here is what the common formats actually mean, and the questions the brochure won't answer for you.

Reading the numbers: 60/40, 80/20 and friends

The fraction describes how the price splits around handover. A 60/40 plan means 60% of the price is paid during construction and 40% at (or after) handover; 80/20 means 80% during construction, 20% at the end. The first number is usually broken into a down payment plus a series of installments. A lower during-construction share keeps more of your money in your own hands while the building doesn't exist yet — which is exactly where you want it if anything goes wrong.

Construction-linked vs time-based installments

The split matters less than the trigger. Installments come in two kinds:

• Construction-linked: an installment falls due when the project reaches a certified milestone — 20% built, 40% built, structure complete. Your payments march in step with real, DLD-inspected progress.
• Time-based: an installment falls due on a calendar date — every quarter, every month — regardless of what's happening on site.

Construction-linked plans are the buyer-friendly design, and the milestone percentages they reference are the same certified completion figures we track daily — DLD inspects the project and certifies the number, and that number is public. Here is how to check it for any project, and your project's page in the directory shows its full certified history. When a milestone invoice arrives, you can see for yourself whether the milestone was actually reached before the money leaves your account.

“1% monthly” plans

The heavily advertised 1% per month format is a time-based plan in friendly clothing: a small monthly payment for years, usually with a down payment first and often a chunk at handover. The monthly number is easy to budget — that is its genuine appeal — but note what it is not: it is not linked to construction. The payments continue on schedule whether the tower is rising or the site is quiet. That makes the developer's track record and the project's actual progress more important on these plans, not less.

What post-handover plans really mean

A post-handover plan stretches part of the price past key collection — say 60% during construction and 40% over the two or three years after you move in. Effectively the developer is financing you interest-free, and developers do not lend for free: the convenience is typically reflected in the price. Projects with generous post-handover terms often trade at a premium per square foot over comparable projects without them. That can still be a rational trade — cash flow has value — but treat it as a financing cost you are paying, and compare the per-square-foot price against what similar units in the area sell for before crediting the plan as a gift.

Questions to ask before signing

• Are installments construction-linked or time-based? The SPA answers this precisely; the brochure often doesn't.
• What happens if construction stalls but a time-based installment falls due? On a calendar-based plan you can be contractually obliged to keep paying into a project that isn't moving. Ask how the SPA handles it — and know what a quiet project looks like from the outside: our stalled-project guide covers the warning signs and the escalation path.
• Which milestones trigger which payments, and who certifies them? Milestones should reference certified construction progress, not the developer's own say-so.
• What are the penalties for a late installment — and are they mirrored by any penalty on the developer for late delivery? Asymmetry here tells you who the contract was written for.
• For post-handover plans: what secures the outstanding balance? Understand what happens to the title deed and your resale options while post-handover installments remain unpaid.

Related: how to check certified construction progress · what to do when a project stalls · projects already past their planned handover
General information, not legal or financial advice — confirm current rules with official channels or a licensed professional.

General information, not financial advice — payment-plan terms vary by developer and change over time; always confirm the current schedule in your SPA.