Dubai's latest updates to the property requirements for those seeking a two-year residency visa could spur demand and attract first-time buyers and investors to the affordable housing segment, analysts have said.
“By eliminating the threshold for sole owners and reducing the joint ownership minimum from Dh750,000 ($204,220) to Dh400,000 per investor, the policy significantly lowers the barrier to entry for a broader pool of buyers, particularly first-time international investors and end users who were previously priced out of visa-linked ownership,” said Alec James of Savills Middle East.
Although the changes have not yet been formally announced by the Dubai Land Department, the details have been published on its Cube online platform, which provides investors with property services to reduce the time taken to obtaining residency.
The updates include lowering the minimum investment requirement for a property owner to obtain a two-year visa. Previously, an investor was required to own property worth at least Dh750,000 to qualify. Under the updated rules, that amount has been lowered to Dh400,000 in the case of jointly owned properties.
The move “will cause much more increase in demand from first-time buyers as well from overseas investors who wish to look at Dubai as a strategic, long-term location to relocate to", said Farooq Syed, chief executive of Springfield Properties.
He predicted a rise in demand for studio and one-bedroom apartments in areas such as Dubai Production City, International City, Arjan, Jumeirah Village Circle, Dubailand, Majan and Dubai Silicon Oasis, with much of the demand coming from Arab and South Asian investors.
Properties valued below Dh750,000 have accounted for 24 per cent of housing purchases so far this year, with properties priced at Dh500,000 or below accounting for 8.6 per cent. This highlights “sustained activity at the lower end of the market”, according to analysts from ValuStrat.
Lewis Allsopp, chief executive of Allsopp & Allsopp, predicted that the new rules would help the UAE to bring in more capital and attract long-term residents, which will support the property market.
The property market in Dubai has seen continued activity despite the raised tension caused by the US-Israeli war on Iran and Tehran's drone and missile strikes on Gulf states.
The volume and value of property transactions rose in the first quarter of this year, according to the latest government data.
Transactions in the first three months of the year were worth a total of Dh252 billion – a 31 per cent year-on-year increase – while the volume of transactions rose by 6 per cent on an annual basis to 60,303.
The emirate also welcomed 29,312 new property investors during the quarter, a 14 per cent annual increase.
However, in March, Dubai property prices recorded their first decline since the pandemic, according to a ValuStrat report this month.
Villa values fell 5.8 per cent compared with the previous month, with a slower annual gain of 12.1 per cent, while apartment values dropped by 6.3 per cent on a monthly basis, with annual growth slowing to 3.9 per cent.
In the past year, Dubai has introduced several measures to boost the property market, including a new scheme to support first-time investors in co-operation with developers and banks.
The emirate's authorities also introduced a smart rental index, which rates residential buildings between one and five stars, in a bid to attract more investment into the sector.
