The UAE has revamped its Golden Visa program and introduced new rules for other long-term visas and permits, with Dubai’s real estate sector likely to reap the benefits.
The global citizenship by investment market is set to grow five-fold over the next three years and become a $100 billion industry by 2025.
This makes the UAE visa reform a timely move to attract a lot of foreign investment, along with skilled foreign workers, professionals, entrepreneurs and students over the coming years.
UAE’s Golden Visa
Until new rules were announced in April, qualifying for the UAE’s golden visa required investors to buy a property worth at least 10 million dirhams, or US$2.73 million.
To put this into perspective, an investor could qualify for direct citizenship of the EU through the Malta or Cyprus economic investor program at a lower price.
In April, the UAE announced that it was slashing the minimum investment requirement to just 2 million dirhams, or US$550,000.
Considering Dubai’s status as the world’s premier trading and financial destination, and other factors including its huge expat population, this sharp reduction will lead to a huge spurt in demand for property in Dubai and other destinations in the UAE.
According to the new rules that came into effect on October 3:
- Investors can qualify for the golden visa by buying a property of a value not less than 2 million dirhams.
- Investors can borrow money to buy the property provided such loans are obtained from specific local banks.
- The investments can be one or multiple off-plan properties provided the total value of the investment is equal to or more than 2 million dirhams and the property is purchased from approved local real estate companies.
Impact on Dubai’s Real Estate Market
Dubai is one of the most sought-after destinations for foreigners seeking to live and work in the UAE. The revamped golden visa program is likely to result in a sharp surge in demand for properties in Dubai.
Factors working in favour of Dubai include its strong economy, developed infrastructure, expatriate-friendly policies and safe environment.
Dubai’s real estate market has been strong in recent times. The city ranks fourth in the world for capital value growth in prime residential properties in the first half of 2022. Prices rose by 4.7 percent as compared to the 2.4 percent average growth in 30 cities across the world. This performance is expected to continue in the second half.
Dubai is the only non-US city in the top-five list of cities with the highest capital value growth in 2022.
It is a great place for investors seeking rental income along with capital growth. Compared to the average global rental growth of 3.1 percent, Dubai saw growth in excess of 5 percent.
While capital growth is expected to fall from 2.4 percent to 2.2 percent in the second half of 2022, the 4,000 millionaires expected to relocate to Dubai in 2022 are expected to keep the city’s real estate sector booming.