New Six Month Visa Law Examined

 

 

 

One of the biggest pieces of recent news was the announcement and confirmation of the new Dubai residency visa law.  This law allows owners of property worth over AED 1 million to obtain a six month, renewable residency visa. While the new law was generally welcomed, many have wanted further details.  Ameya Salatry, Better Homes’ Head of Legal, answers some of the most common questions:

 

 

1.       Are the six month visa and its various conditions enough to entice people to buy property and help revive the market? Reasons why/why not?

 

Yes- The visa will ease travel for investors from India, Pakistan, Iran and Russia, who had faced tighter visit visa rules in the past. Now, they will be able to visit frequently to manage their properties.

No- Those who want to buy property here or have already purchased property in the UAE often want to stay here longer than six months at a time. Leaving the country just to come back is understandably seen as an inconvenience for investors. Some owners plan to own property for 20 to 30 years, so six months’ permission to stay is problematic.

 

We expected the visa to encourage foreign investment into the nation’s real estate sector but the visa should have had a longer time frame and without a restriction of being tied to a property value. This is a step in the right direction but is probably not far enough to allay investors’ concerns.

 

2.       Why do you think the Government limited it to six months and imposed several conditions? Could they possibly be worried about a flood of applications?

 

Yes we feel partially that is the reason. Although this is fundamentally a move to clarify speculation over this regulation and to bolster the real estate sector, the Government wants to be very careful in streamlining visa applications at the backdrop of immigration rules in the UAE.

 

3.       To what extent does the AED 1m minimum property value price out those people who would benefit most from having the residency visa in the first place (i.e. the less well-off)?

The AED 1 million minimum property value as a precondition may indeed be problematic because (a) the property values have fallen; and (b) foreign investors wishing to invest and obtain visas may not look upon this condition as a suitable one, in the midst of an ailing economy. Regulating residency permits on the basis of property value is also bound to create illegal “workaround” solutions where buyers technically pay over 1m but then work out a deal with the seller to get the money back somehow.  In our opinion, this minimum level should be revised or removed from the visa regulation.

 

4.       To what extent does the condition of having to earn a minimum salary of Dh10,000 while holding the residency visa eliminate the very reason for having it?

 

Foreign investors need to prove that they earn a minimum salary of DH 10,000 in order to avail the 6 month visa benefit. Foreign investors can only obtain visa if all of the requirements including the one above are met.

The visa does not give the owner of the property the right to work in the country. In that, the requirement of DH 10,000 as salary condition would be an obstacle in the event an investor looses a job and cannot prove his wages to avail to this visa. It defeats the purpose in that sense. However, we feel the legislative intent is twofold; (a) to attract foreign investors in the foreign countries to hold properties in the UAE and visit the country to manage the same and (b) for foreign investors who already reside in the country and who can fulfill all of the requirements for the visa application to have benefits of the visa to own and manage properties in the UAE..

The purpose is not to guarantee an investor a 6 month visa in the event of falling circumstances like loss of employment, unfortunately.

 

5.       Does the visa have the potential to develop the UAE’s property market as a retirement or second home destination?

 

We do not feel so, because people in the retirement and second home category normally look for a longer option or prefer to avoid fulfillment of visa conditions which in the present case would have to be met on a recurring basis of every 6 months. The visa works well for seasonal visitors, but not for anyone who wishes to make the UAE their home.

 

6.       If you own two properties that add up to more than Dh1m, do you qualify for a residency visa?

 

We do not have the text of the law to answer this question, but we feel it would be applicable only for a single unit or apartment.

 

7.       If the property is initially below Dh1, but rises in value, do you qualify for a visa?

 

You would qualify for a visa once it touches Dh 1 Million or more in value, not before that.

 

 

Note: The above is for indicative purposes only and should not be construed to mean legal advice or interpretation of the law. We do not guarantee the accuracy or correctness of the information provided herein above.

 

 

For more information on the current regulations regarding property ownership in the UAE, please visit bhomes.com or speak with a consultant at +971 600 52 2212

 

 

 

 

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