Property and wills experts expect a surge in business from older residents as the new five-year retiree visa takes effect.
Sean Hird, the director of the DIFC Wills Service Centre, said he’s expecting a significant increase in the number of foreign residents registering new wills to protect their property and investments after the Government unveiled its new five-year retirement visa earlier this week.
“The people who will receive the new visa have significant wealth. They will now have to think long and hard about how to protect their assets as they grow older,” said Mr Hird in a statement. “The obvious step is to take out a recognised and enforceable DIFC will and we expect a significant growth in DIFC will registrations.”
Meanwhile, Lynnette Abad, the director of research and data at real estate portal Property Finder, is expecting a boost in the number of older residents buying homes, a segment of buyers that has declined in recent years.
“The initiative to offer a five-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,” said Ms Abad. "According to our research, over the last few years, the trend of people over the age of 50 buying property in Dubai has declined by about 40 per cent. 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."
To qualify for the retiree visa, non-Emiratis over 55 must either have an investment property worth at least Dh2 million, financial savings of Dh1m, or an active monthly income of Dh20,000 or more. The visa, set to be available from 2019, is valid for five years with the “possibility” of renewal for those hoping to stay longer.
Keren Bobker, a senior partner at financial advisory Holborn Assets, said the new laws will make property ownership a more attractive option for residents. However, she advises non-Muslims with assets in Dubai or Ras Al Khaimah to register their wills at the DIFC's WSC to "circumvent" any "issues with Sharia law".
According to the WSC, any non-Muslim that dies without a recognised and enforceable will may have their assets divided among family members according to Sharia precepts, following a pre-determined formula. Mr Hird said he expects holders of retirement visas to take out either property wills or financial asset wills, as significant property or financial resources are a requirement of the new legislation.
Will holders can ensure their wealth is passed to their chosen beneficiaries following the inheritance laws or customs of their home country. The document is enforced by the Dubai Courts.
Mr Hird said he expects foreign residents and business owners who choose to stay after retirement will now commit to firm financial planning, rather than putting off important decisions.
Another sector set to benefit from heightened investor confidence and higher levels of foreign direct investment is the property sector, as one of three stipulations of the visa requirements is owning a property worth over Dh2m.
"We expect the move to bolster the real estate sector and encourage people to switch from renting to owning property as the barriers to ownership - such as lack of security on visas and the amount of red-tape involved in the purchasing process - start to be eroded by these forward-thinking measures," said Samer Abdin, general manager of dubizzle Property.
Mario Volpi, the sales and leasing manager at real estate consultancy Engel & Volkers, said the new ruling offers older residents "clarity" on life after work in the UAE, which could translate into some individuals going ahead and buying property in the future.
"The holiday home market should definitely benefit from this ruling as it will open up to more individuals,” he said.
However, while Mr Volpi is expecting an increase in older buyers inquiring about availability and general property information, he said he is "not certain this will translate into a 'surge' of buyers".
"The public needs time to adjust to new rules and regulations, and given there are still questions to be answered regarding the over-55 visa, I believe we need more time before suggesting this approval will become a catalyst for the property market.”