Qatar's visa program adds a new twist to the competition for international property buyers.
Qatar property visas lure buyers
The Qatar government's recent move to issue long-term residency visas to international property owners is adding a new element to regional competition for buyers.
A report released yesterday by the property consultancy Jones Lang LaSalle said Qatar's policy would "increase the competitiveness of Doha and strengthen the call for similar measures in the UAE".
Investors and second homebuyers in the UAE routinely list visa policy as a key issue when considering a purchase, property executives say.
In a survey last year of 500 buyers, lawyers and brokers in the UAE by the law firm Hadef & Partners, 88 per cent listed "more flexible visa options for owners-investors" as one of the issues that could boost recovery in the property sector.
"The issue of visas is one of the major constraints for demand in residential in the UAE," said Craig Plumb, the Middle East and North Africa head of research for Jones Lang LaSalle. "Looking at the overseas market, it is very competitive."
Visa policy for property buyers has long been complicated in the UAE. At the height of the property boom, some developers promised buyers visas, often misleading them about the process.
The Government put an end to that practice in 2009 with a law that established procedures for property buyers to be issued with temporary residency visas.
But the law includes restrictions: the value of the property must be at least Dh1 million (US$272,264); the owner must have at least Dh10,000 in monthly income; and the visa must be renewed every six months at a cost of Dh2,000.
The six-month restriction is the element often cited as a negative factor by potential property buyers, industry experts say.
"Property is a long-term investment," said Michael Lunjevich, a partner in Hadef & Partners. "The buzzword among property investors is longer property visas."
Qatar's law offering residency visas to property buyers has been on the books since 2006, but the first visas were handed out only last month. Just two visas have been issued, to expatriates from Egypt and Pakistan, but more are expected.
The visas are "exactly what we needed", said Sam Youssef, the managing director of Better Homes in Qatar. "It's going to open up the real estate market, big time."
Buyers will receive a five-year visa that can be renewed. But they lose their status if the property is sold, Mr Youssef said. International inquiries about property have increased in the two weeks since the government announced the issuing of the first visas, he said, adding the law also allows companies and individuals to establish residency without a sponsor.
"This will open doors for multinational companies," Mr Youssef said.
Qatar is still relatively new to the international property market. The 2006 law made it possible for non-Qataris to own property, but only in certain designated projects. The first titles to overseas buyers were registered in 2009.
Offering residency visas will "help stimulate demand" in Qatar, said David Dudley, who covers the country for Jones Lang LaSalle.
"It's important to note that Qatar, Abu Dhabi and Dubai are competing for the same demand," Mr Dudley said. "Locations that make it more lenient to obtain a visa will capture more of the demand."