New retirement option for expats will boost property transactions in the over 50 age bracket currently declined by 40% says Property Finder
1. The expat should have investment in a property worth Dh2 million, or,
2. Have savings of no less than Dh1 million, or,
3. Have an active income not less than Dh20,000 per month
In line with the announcement earlier this spring for 10-year residency visa for certain professionals and investors, as well as the announcement to allow 100 percent ownership of foreign companies, these initiatives are expected to give an additional boost to the markets. As the property market is experiencing a correction of prices, this is a welcomed announcement as it will instill confidence for those who have the potential to make the UAE their home.
The traditional system requires expatriates to typically be sponsored by the company they are employed by, or by a family member who is otherwise employed and sponsored. UAE residents who find themselves out of work or are retiring from work are otherwise forced to return to their home countries without residency.
While some will still inevitably want to return to their home countries, 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 property prices in an overall decline across the Emirates, many are looking to the government to help bolster investment. With many property developers offering new and attractive flexible payment plans, coupled with lower prices and now the government’s support for people to stay in the country longer, we hope to see continued investment in the property sector.
Lynnette Abad, Director of Research and Data at Property Finder noted the following regarding the government’s announcement. ”The initiative to offer a 5 year retirement visa is a much welcomed announcement considering there are just over 150,000 residents aged 55 and over as estimated by the 2017 Dubai Statistics Centre of Population and Gender Report. According to Property Finder’s own research, over the last few years, the trend of people over the age of 50 buying property in Dubai has declined by about 40%. This could be attributed to the fact that retirement was never a viable option here. This, along with the Abu Dhabi’s Tomorrow 2021 plan will surely boost the market overall.”
Paul Kelly, Operations Director of Allsopp & Allsopp, a Dubai based Real Estate broker firm, also expressed similar sentiments on the positive effect the new expat retirement law will have on the property market.
“The law is welcome news for expats living here in the UAE. It gives a sense of security for those nearing retirement age and may encourage expats to put down more stable roots. People will no longer look at Dubai as a short-term plan but rather as a place that can become home. The Dubai property market will benefit immensely as a result of more expats investing in family homes”, he said.
He continued, “Most expats have a money-making mindset when they move to Dubai with a short-term plan and goal before moving back to their home country. The cabinet’s decision to enforce the long-term visa law now allows expats to look at Dubai with more longevity. The UAE cabinet are giving expats a more positive and secure outlook towards their future in the country. The UAE is no longer a temporary move to enhance a person’s career but also a move to enhance a person’s lifestyle and future.”
The statement from the Cabinet meeting noted that for those eligible for the new retirement visa, they would begin being handed out in 2019. As for the 10-year residency visas announced earlier in the spring, it is expected that more information about those will be issued before the end of the year.
Overall, it is clear that the government remains committed to improving the lives of nationals, residents and continuing to ripen the environment for investment.