Permanent Residency to Boost Foreign Investment in UAE Real Estate

The United Arab Emirates recently launched a permanent residency scheme to encourage wealthy individuals and exceptional talents. This could attract more Indian professionals and businessmen to the country. This could be a game changer and provide a boost to the real estate market by encouraging expatriates to invest in property and settle in the Gulf nation. The “Gold Card” program unveiled by UAE Prime Minister Sheikh Mohammed bin Rashid Al-Maktoum is open to investors and “exceptional talents” such as doctors, engineers, scientists, students and artists. Investors investing at least Dh10 million would qualify for 10-year visas, while entrepreneurs and special talents would be entitled to five-year residency. The first recipients of these visas were unveiled last month and include 6,800 expatriates from over 70 countries with combined investments in the UAE totaling Dh100 billion.

The Gold Card offers unprecedented benefits to the cardholders and their families, while creating an attractive environment for business and growth. The benefits of the permanent residency also include spouse and children of cardholder so as to ensure cohesive social ties. This new initiative will attract greater foreign investment (FI) and activate local economy, making it more efficient and attractive for investors.

The “Golden Card” visa includes the following categories –

• General investors who will be granted a 10-year permanent residency visas.
• Real Estate Investors, who can get a visa for 5-year visa.
• Entrepreneurs and Talented Professionals like doctors, researchers and innovators can get 10 years visa.
• The fifth category is ‘outstanding students’. These will also be permitted 5 years permanent residency visas.
• All mentioned categories of visas can be renewed upon expiry.

Lewis Allsopp, CEO of Allsopp & Allsopp, Dubai estate agents, said this is a huge milestone for the UAE and for the Dubai property market. “Over the last few years, we have seen continual steps to enhance the property market and to add longevity to the UAE with five-year retirement visas, long-term visas and ten-year visas,” he said. “Most expats have a money-making mindset when they move to Dubai with a short-term plan. The UAE Cabinet’s decision to enforce a Gold Card for permanent residency, now allows expats to look at Dubai as a home rather than a temporary plan,” he added.

Currently, short-term visas linked to employment hold back expatriates from investing and owning real estate in the UAE. They prefer to remit savings to their home countries instead. The Gold Card scheme will encourage expats to make long-term investment goals, including owning a property. “This is a game changer for the real estate industry in Dubai. We are yet to get full details of the Gold Card program, such as who can qualify, the terms, etc. However, it’s definitely a step in the right direction and very much needed to stimulate investment,” Lynnette Abad, Director of Research and Data, Property Finder, said. The permanent residency is a good step forward and likely to boost the fortunes of its property market, a statement from the Property Finder said. Currently, the UAE does not grant permanent residency visas to expatriates however this Golden Card visa is a renewable 10-year visa which will offer a form of permanent residency in the UAE.

How the Gold Card Residency Visa in The UAE Will Impact the Property Industry?

The Golden Card announcement will undoubtedly stimulate the property market in Dubai and the rest of the UAE. With the new UAE visa, expats looking for long-terms options can now focus on investing in the UAE instead of buying property and other assets in their home country. High Net Worth Individuals will also be attracted by the longevity of property investments in the UAE, which is known for its unparalleled lifestyle options and income-tax-free advantages. The new Golden Card, which will offer people a form of permanent residency visas in the UAE is an attractive proposition, especially considering the fact that this is one of the world’s safest countries.

This initiative will encourage more expats to invest their assets within the UAE. With expatriates accounting for almost 80% of the UAE market, the PR program, if properly implemented, would be a game changer for the real estate sector. It would have an immediate positive effect on market sentiment and aid in absorbing the supply scheduled to come to the market. A UAE federal agency said it has received around 6,000 applications from investors and entrepreneurs in the first week of taking in applications for long-term residency visas.

Developers also need to incentivise with unique schemes that offer some kind of permanence and value for money to attract investors in a competitive market. They must recognise the increase in freelance workers and the importance of fostering environments that support entrepreneurs. Take the example of Emaar Properties which recently launched the Executive Residences in Dubai Hills Estate targeted at entrepreneurs and SMEs, which make up 80% of the Dubai economy.

• On paying 20% of the apartment’s sales price, buyers receive a free three-year renewable business license with the Dubai Multi Commodities Centre free zone.
• 100% business ownership and a free three-year renewable family residence visa.
• Buyers are encouraged to operate a home office in this concept, doing away with the need to lease office premises.
• Until your apartment is complete, DMCC will provide you with a flexi desk to utilise as your business address in the interim.

The Dubai Land Department’s transactional data suggests that demand has been strong for the Executive Residences apartments. The months of April and May have seen almost 11 off-plan transactions for 1-bedroom apartments in this project, with the average property price for these units hovering around AED 1 million. This is a first step in making operational costs for small start-ups more affordable. Announcing more such enabling projects could be a real catalyst for the UAE property market.

India and the UAE

The Indian expatriate community is the largest ethnic community in UAE. It constitutes roughly about 30% of country’s population, which is around 9 million Although, most of the Indians living in UAE are employed, about 10% of Indian population constitutes dependent family members. This Golden Card program could attract more Indian professionals and businessmen to Gulf nation. Though most of the Indians living in the UAE are employed, about 10 per cent of the Indian population constitutes dependent family members, according to the Indian Embassy website. The recent changes provide stability and precision to prospective investors, entrepreneurs, individuals with specialised talents and outstanding students. Additionally, it is expected to strengthen and improve the UAE’s economy due to the investments in real estate and public investments, along with the contributions of the talented and exceptional to the success story of the UAE.

 

Sources:

• https://gulfnews.com/uae/shaikh-mohammad-launches-permanent-residency-system-dubbed-the-gold-card-1.64091572
• https://www.moneycontrol.com/news/business/real-estate/uaes-permanent-residency-scheme-to-boost-real-estate-in-country-experts-4038561.html
• https://economictimes.indiatimes.com/nri/visa-and-immigration/uae-launches-golden-card-scheme-to-woo-wealthy-investors-exceptional-talents/articleshow/69433510.cms