The UAE government’s announcement for a five-year residency visa for retired expatriates aged 55 and over is expected to result in increased investment in the property sector. One of the visa requirements is for the expat to have an investment in a property worth Dh2 million. This is likely to see increased take-up of properties and maybe even the emergence of a new alternate asset class in the UAE – retirement communities.
Expatriates are typically sponsored by the company they are employed by or by a family member who is employed. UAE residents who find themselves out of work or are retiring from work are forced to return to their home countries without residency. There are a host of people who would be happy to continue to make the UAE home for as long as the government extends a place for them.
With many developers offering flexible payment plans, coupled with lower prices and the government’s support for people to stay in the country longer, market observers hope to see continued investment in the property sector.
A paradigm shift
“In line with ongoing measures to improve investor confidence and sentiment, this new announcement is also expected to positively impact the UAE property sector over the coming years, bringing a boost to both supply and demand, by way of attracting and retaining expats after retirement. This is expected to trigger a paradigm shift – from being a transient destination to a long-term avenue for expats to settle down in the country post retirement,” says David Abood, partner at Core.
“There’s no doubt that having the opportunity to stay in the UAE where expats enjoy its safe haven status would have a positive impact on the property sector by encouraging home sales around the country, as this is one of the optional requirements to gain UAE residency after retirement. Also, it may encourage retirees from elsewhere in the world to choose the UAE as a place to buy a home and move to for their retirement,” observes Haider Tuaima, head of real estate research, ValuStrat.
While the UAE’s economic strength still proves to be a draw for expats, the major changes around residency rules will help create an even more stable and secure UAE and embrace a wider international appeal as a retirement destination. In addition, long-term prospects might result in more expats looking to invest. And with the retirement landscape changing, the economic and environmental situation will benefit, as more non-locals will aid the growth of healthcare, real estate and infrastructure, said Kashif Shahzad, president of Rijas Aces Property Development.
Dubai has traditionally seen a very transient expat population. This move will give a sense of security for those nearing retirement age. The cabinet’s decision to enforce the long-term visa law will allow expats to look at Dubai with more longevity.
“We expect to the move to encourage people to switch from renting to owning property as the barriers to ownership – such as lack of security on visas and the amount of red-tape involved in the purchasing process – start to be eroded by these forward-thinking measures,” reckons Samer Abdin, general manager of dubizzle Property.