The UAE's knowledge-based economy quest will have a very positive
impact on real estate
When the UAE Cabinet approved a raft of amendments to the
residency status of expatriate professionals earlier this year, many
celebrated. For those that would like the option of remaining in the country
long-term the changes in law are indeed a game-changer. The significance,
however, of such amendments goes far beyond the added sense of security that
the nation’s foreign residents will, undoubtedly, now experience. Rather, these
changes reinforce the UAE’s commitment to developing into a knowledge-based
economy that attracts and retains the greatest of talents; and, the
implications that this will have on the nation’s real estate sector are
important to the wider economy.
Expatriates make up approximately 80 percent of the UAE’s
population and are consequently of great influence to the UAE economy. Ensuring
that talented individuals remain in the country has a two-fold effect: Firstly,
there is the direct impact that comes from ensuring that their spending power
remains in the UAE, as opposed to being transferred to their home country: and
secondly, that talented professionals tend to command high incomes and
legislation that promotes a greater sense of inclusion will encourage such
individuals to invest into the UAE economy.
Mr. Ahmed Shaikhani said since the government open the door for
resident of UAE to buy a property, This new steps open a door for investors to
think twice living in Dubai, The real estate sector, in particular, the
residential market has, historically, been closely linked to the country’s
economic performance. A flurry of expatriates into the country has a positive
effect on the nation’s rental market, which equally, feels the effects once
foreign residents return home.
Furthermore, Mr. Shaikhani said, According to the Dubai Land
Department DLD, there was a 12 percent rise in owner/occupier mortgage
transactions, demonstrating a maturing effect whilst also highlighting a growing
confidence amongst buyers in the emirate. It would be very attracting for the
customer, to go in a follow they can work and live and their children as well.
Although, there are a bit different rules for the kids and over 18 children,
but those are not very difficult. Their visa policy is quiet flexible if
the candidate fulfill their requirements ministry will issue the visa
Retail and hospitality are additional sectors that will directly
benefit from the UAE’s ability to retain a highly talented workforce, with
strong purchasing power. Residents who experience a high level of job security
are more likely to spend on staycations, on dining out and in the UAE’s
extraordinarily variety of retail outlets.
Keeping hold of talent
As the UAE continues to diversify its economy away from a
reliance on oil into a society that celebrates the importance of human capital,
retaining talent has never been more crucial. The co-dependent relationship
between the UAE’s status as an economic powerhouse and its ability to keep
exceptional talent should not be underestimated. To date, the UAE has been
incredibly successful in creating an environment that supports and celebrates
local and foreign talent alike to ensure the nation’s continued development.
The majority of foreign corporates cite ‘depth of labour pool’as a key
contributor to their decision to locate business units in the UAE.
The new residency rules is just one of a number of recent
initiatives that are aimed at attracting and retaining a highly skilled and
educated workforce to/in the UAE to further stimulate the economy. Under the
new law, long-term residency will be available to retirees who, amongst other
conditions, own property worth AED2m. This law encourages younger residents to
consider such an investment, while rewarding those that have made important
contributions to the nation and its development into the economic powerhouse
that it is today. Retirees are not the only demographic that are being recognized
for their efforts. The UAE Cabinet has also unveiled plans to introduce 10-year
residency visas to specialists in the medical, scientific, research and
technical fields and longer visas for students and entrepreneurs, whilst
enabling foreign investors to fully own a company in the UAE. These fundamental
changes are sure to stimulate both the rental and owner-occupier markets across
residential and commercial sectors.
Open for business
While the new laws on residency are a boost to those already
living in the UAE, they should prove instrumental in attracting further talent
to the country. It is clear that some would-be expats are deterred from
relocating due to the uncertainty that surrounds foreign residency visas. The
UAE is leading the way in letting the world know that the country is open to
the brightest and most talented individuals and will support them in any way it
can to ensure they feel settled and secure in their new country of residence.
It also sends a clear message to investors, that the UAE is extremely business
friendly and has the sophisticated legal framework required to support foreign
entities that wish to establish a presence in the Emirates.
This legal evolution is an example of the UAE’s forward-thinking
approach to creating a truly innovative society that nurtures talent, supports
entrepreneurship and rewards hard work. Experience also suggests that the
processed changes will be adopted beyond the borders of the UAE. Whilst the new
law will undoubtedly stimulate demand, it will, of course, be some time before
we see this translate into transactions and pricing. The amendments provide
increased security to those wishing to live and invest in the UAE long-term.
But, perhaps most importantly they provide a message to those outside the
country, that this is a government that is committed to stimulating further
economic growth and providing the conditions required for foreign investments
to flourish. The benefits that this will bring to the wider economy will be
meaningful.
