We find out how new longterm visas could impact moving trends in Dubai
Bana Shomali, CEO and founder of ServiceMarket, explains the potential benefits of Dubai’s array of new five and 10- year visas
IT’S GOOD NEWS ALL AROUND for expats living in Dubai. Not only are Dubai residents leveraging lower rental rates to upsize their homes, according to a recent study by ServiceMarket, the UAE’s leading marketplace for moving and home services, but now the UAE government has also announced new long-term visas for expats.
These include five-years visas for retirees and 10-year residency visas for investors, entrepreneurs, specialists and outstanding students as well as their families. The introduction of these long-term visas is bound to transform the real estate sector and will surely cause major shifts in moving trends across the region. Here’s what you need to know to understand its immediate effects.
New long-term UAE visas are game changers
Before we study their impact, it’s important to know the five types of long-term residential visas that have recently been introduced in the UAE.
Investors
A 10-year residency visa can be obtained by investors who invest Dhs10m, out of which 60 per cent should not be in real estate. It can be a public investment through a deposit or in a business. Those who invest Dhs5m or more in property are eligible for a five-year residency visa. The invested amount should be completely owned by the investors, not loaned, and retained for at least three years.
Entrepreneurs
A five-year multiple entry visa is available to entrepreneurs with a previous project worth Dhs500,000 or those with the approval of an accredited business incubator in the UAE.
Specialists
Expats with specialised talents, including doctors, specialists, scientists, inventors, and creative individuals working in the field of culture and art are eligible for a 10-year visa, given that they have a valid employment contract in one of these fields in the country.
Outstanding students
A five-year visa will be granted to outstanding students who have a grade of 95 per cent or higher in a secondary school, or those who graduate with a GPA of 3.75 from a university.
Retirees
Expats who are at least 55 years old can obtain a five-year retirement visa if they invest Dhs2m in property, have savings of Dhs1m or more, or have a monthly income of at least Dhs20,000.
What it means for the UAE’s economy and expats
The main purpose of these long-terms visas is to boost the growth of business in the UAE. We believe this will be achieved in three ways.
First, the visas for investors are sure to drive more investment into the economy as investors would now have an added incentive to invest in the UAE economy. By allowing investors to stay in the country for a longer period of time, these long-term visas would also reduce any perceived risks by a large degree.
Second, with long-term visas being offered to scientists, specialists and outstanding students, a brain gain can
be expected in the economy. This means that we're likely to see more initiatives like the recently launched UAE Platform for Scientific Laboratories, Emirates Smart Data Centre, a large-scale Artificial Intelligence (AI) platform, and Mohammed Bin Rashid Space Center in the years to come.
The five-year retiree visa will allow retirees to stay in the country for a longer period of time. It will also directly benefit the UAE economy because their retirement savings will not be transferred overseas.
Impact on real estate demand and home ownership
The new long-term visas will surely encourage more expats to stay in the UAE, and with fewer people leaving every year the expat community will continue to grow. The greater the number of expats in the country, the more demand for homes there would be over time.
Another trend we can expect to see is the switch from renting to owning homes. According to a study by Propertyfinder, only 30 per cent of respondents living in the UAE were homeowners. A lot of expats wish to stay in the UAE even after they have retired. Previously, they had no option but to move back to their home country after retiring, so it did not make much sense to have a lot of money tied up in property. But the new retiree visa has given them an opportunity to stay in the country for a longer period of time, which means that now many would want to move into more suitable homes.
What's more, one way to get a retiree visa is to invest in a property worth Dhs2m, so we can expect a lot of people to invest and move into their own homes instead of living in rented homes. A recent poll revealed that 58 per cent of UAE residents plan to invest in property in the next 12 months, so this trend is likely to gain traction.
Impact on expat relocation
With the introduction of these new long-term visas, the total number of investors, entrepreneurs, specialists, students and retirees in the UAE is likely to increase over the next couple of years.
There are two main reasons for this net gain. First, more inbound international relocation by investors, entrepreneurs, specialists, students and retirees can be expected. Second, fewer expats will be leaving the country every year. It goes without saying that those who move to the UAE would be looking for new homes, increasing the demand in the real estate sector.
In conclusion, we have yet to see how these long-term residential visas will impact the real estate demand, home ownership and moving trends in the coming years, but we can expect to see some major shifts. In any case, this initiative is likely to benefit the UAE economy in multiple ways.
The new long- term visas will surely encourage more expat s to s tay i n the UAE, and with fewer people leaving every year the expat community will continue to grow.