Gabriella De La Torre, CBRE Director of Consulting, answers key questions, and takes a look at the potential growth of the real estate market, given this new buyers’ segment, and how offerings will be tailored to meet the demands of retirees.
1. The first phase of the retirement visa will be directed at those already living in the UAE, how do you expect the retirement visa to influence their behaviour when it comes to property investment in the UAE?
Based on Government statistics the current population over the age of 55 is relatively limited at around 5 to 6% of total. However, a greater proportion (around 12%) lie between the ages of 45 and 54, nearing the retirement age and indicating significant potential for future demand from this segment. What the new retirement visa essentially does is provide a residency option for current and future residents of the UAE to consider. We believe that this new option will help to stimulate demand for home ownership across the country and lend a greater permanence to resident behaviour and real estate purchase decisions. In a similar fashion, the UAE could increasingly be considered as a retirement destination for people currently living and working outside the UAE, and in this case, it will be key to further develop and provide the quality of life, services and facilities that are typically required by this target segment.
2. Once the visa is opened up to global retirees, which nationalities do you expect to be interested in acquiring a retirement visa in the UAE through property investment?
Currently, some of the top international purchasers of real estate across the UAE are from the GCC, India and China. We believe that this trend is likely to continue moving forward, and the retirement visa will further bolster demand from these key existing source markets and among buyers who are already familiar with the region and the UAE specifically. At the same time, this new visa opens a range of new opportunities among other source markets, including the likes of African and European countries which can benefit from relative proximity to their countries of origin.
3. Which Emirate do you believe will benefit the most from the retirement visa?
Dubai and Abu Dhabi both definitely stand to benefit, leveraging on the quality facilities and amenities to be enjoyed in each location respectively – from quality healthcare options to retail and F&B options to an array of leisure facilities – as well as the wide range of real estate offering. Furthermore, these emirates stand to benefit from their world-class airports which will facilitate travel and connectivity for future residents, which is also a key consideration among investors. At the same time, other leisure and hospitality-driven locations, such as Ras Al Khaimah and Fujairah, could also provide a unique appeal to retirees, leveraging on the existing resort offering and profile, particularly among those who seek a more relaxed environment to retire in.
4. What type of property do you think will see the most rise in demand from retirees?
In general, demand will be driven by several factors which will vary from one retiree to another, including elements such as income levels, family size and personal design preferences. However, we expect that properties which benefit from prime locations, easy access to quality healthcare facilities and which offer community living will outperform the wider market.
5. In your opinion, how will real estate developers tailor their offerings to meet the demands and expectations of retirees?
The UAE naturally has a lot to offer, benefitting from its status as a safe haven within the region and offering a high quality of life for its residents. Moving forward, we expect that developers targeting this specific segment of the market will focus more and more on incorporating quality healthcare facilities and services within their developments in the form of on-site care or potential tie-ins with key healthcare operators, as well as designing their projects in such a way as to provide the right level of privacy and serenity while allowing for an active community life.
6. How do you see this visa effecting investment in real estate over the next five years?
In general, we believe this to be a positive move for the real estate sector overall, supporting potential demand from new segments and source markets. What will be key moving forward will be the implementation of this new visa as well as the continued evolution of the UAE as a global destination for leisure and tourism coupled with ongoing Government initiatives to support quality of life.
For any additional insights on the UAE real estate sector, contact Gabriella.