The removal of the minimal down fee requirement of Dh1 million for eligibility for the ten-year residency in Dubai has led to an enormous growth in the call for properties worth Dh2 million.
Industry executives document that many belonging developers are responding to this surge in calls by way of growing the size of flats to cater to the developing market for Dh2 million properties. Additionally, traders with investments of Dh1.5 million or more are reportedly increasing their budgets to satisfy the threshold for eligibility for the 10-year residency.
Impact of Golden Visa on Real Estate Demand
Since the creation of the Golden Visa for asset traders, the call for for actual estate in Dubai has experienced an exponential increase. This initiative has attracted great foreign investment at the same time additionally encouraging existing tenants to transition to belongings ownership to keep away from growing rental charges in the city.
In January, Dubai made a big coverage exchange with the aid of removing the requirement of a minimal down fee of Dh1 million for eligibility for the Golden Visa. This circulate was aimed toward boosting the burgeoning real property quarter. Consequently, there was an inflow of extra consumers coming into the local market, contributing to its dynamism and increase.
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Developers Adapting to New Demand
Farooq Syed, the CEO of Springfield Properties, has noted a significant surge in demand for properties that qualify buyers for the Golden Visa.
“We are witnessing a substantial increase in clients from countries like Syria, Iran, Pakistan, and others, who do not hold strong passports. They are transitioning from one-bedroom to two-bedroom properties to meet the eligibility criteria for the 10-year residency,” Syed told Khaleej Times.
He in addition elaborated that some clients who have been first of all considering shopping for a property worth Dh1.9 million have opted rather for Dh2 million residences to qualify for the Golden Visa. Moreover, customers who were at the beginning making plans to invest Dh1.5 million or more at the moment are expanding their budgets to Dh2 million to capitalize on the possibility furnished with the aid of the Golden Visa scheme.
“Even developers are now opting for slightly larger unit sizes to accommodate such customers. I know of a developer who initially priced their units at Dh1.8 million to Dh1.9 million but decided to increase the size of the units to cater to the growing number of clients seeking properties valued at Dh2 million for the Golden Visa,” he added.
Investor Interest in Dh2 Million Properties
Imran Farooq, CEO of Samana Developers, echoed similar sentiments, stating that there is significant interest in properties valued at Dh2 million, and the new regulation has led to a spin-off trend where buyers are opting for 2-and-3 bedroom options with a value of Dh2 million or higher.
Under the new system, he explained, a buyer who pays the minimum down payment of 10 percent or registers with the Oqood (Initial Sale Contract) becomes eligible for the Golden Visa.
“The new rule is anticipated to transform tourists into long-term residents as Golden Visa holders. Tourists, especially new ones, often feel overwhelmed by the process of finding the right agent, visiting various properties, and ultimately deciding on a suitable property. Off-plan options streamline this process and provide a safer investment opportunity,” Farooq remarked.
He similarly defined that typically, the off plan marketplace requires a down fee of 15 to 20 percent, relying upon the price plan selected by the customer. “This means that for a Dh2 million assets buy, a down fee of Dh300,000 or 15 percent is practically required to be eligible for the Golden Visa. However, the exact amount for the down payment varies based on the property’s location and type,” he added.
Massive demand
Sijo Jose, team lead at Betterhomes, highlighted that the UAE recently abolished the mandatory Dh1 million minimum down payment for qualification for a Golden Visa, intending to promote increased residency and investment in the country.
“In the latest update, eligibility for a Golden Visa is granted to buyers investing in off-plan properties if the project is under construction and has completed 40-50 percent of the construction phase. The minimum down payment is determined by the developer, typically ranging from 20-30 percent of the purchase price,” he explained.
Boosting Demand for Mid-Range Properties
Jose added that the elimination of the minimal down payment requirement for the Golden Visa should stimulate increased calls for residences worth Dh2 million.
“By lowering barriers to entry, particularly through reduced down payments, properties become more accessible to a broader range of buyers and investors. This enhanced accessibility is expected to spur demand within this price range. However, the overall impact on demand will depend on various factors, including economic conditions, investor confidence, and the specific dynamics of the Dubai real estate market,” he stated.
Golden Visa’s Significance
Muhammad Binghatti, CEO of Binghatti Holding, emphasized the significance of the Golden Visa, stating that it plays a vital role in attracting buyers who find the Dubai real estate market highly appealing.
“Almost every buyer I’ve encountered, especially those investing over a certain value, is keenly interested in obtaining the Golden Visa. This initiative has significantly bolstered the market. Many individuals, families, and businesses are choosing to settle in Dubai, and they are seeking this 10-year residency visa,” he explained.
