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Thu, Nov 21, 2024 | Jumada al-Awwal 19, 1446 | DXB
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GCC unified tourist visa: Short-term rental demands set to rise
Tourism, hospitality, real estate industries are optimistic that the UAE and Gulf countries will benefit like the Schengen countries on the unified entry permit
Demand for short-term rentals is set to spike in the UAE as the Gulf Cooperation Council (GCC) member states have agreed to roll out a unified tourist visa, similar to the Schengen-like visa for tourists worldwide.
The interior minister of the Gulf states approved the single GCC tourist visa in Oman last week, which will significantly create new jobs in the travel, tourism and aviation sectors and add fillip to the overall economies of the region, especially the UAE and Saudi Arabia.
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The regional governments would study a unified tourist route that connects all six countries. The route will be followed by foreign tourists whose stay extends for over 30 days. The UAE’s Emirates Tourism Council would also prepare the Emirati tourism route that connects all seven emirates.
As part of the GCC’s 2030 strategy, there are 837 tourist sites, of which the UAE has 399, the highest among all Gulf countries. The UAE also hosts the most number of tourism events and activities at 73 out of a total of 224 across the whole Gulf region.
Tourism, hospitality and real estate industry executives are highly confident that the UAE and the neighbouring countries will benefit just like Schengen countries are cashing in on the unified visa.
However, they believe that the short-term rental segment in the UAE, especially Dubai, will be the largest beneficiary as it is set to witness massive demand on the back of plenty of options available to tourists as compared to other cities and countries around the region.
According to the latest figures released by Dubai Tourism, 12.4 million people visited the emirate between January and September 2023, a significant increase from the overall number seen in 2022 of 7.08 million visitors, a 97% increase from 2021.
Tourist traffic to the UAE has been growing quite steadily since 2020, and with the launch of this visa, they will have the option of exploring more countries. The short travel times and similar weather conditions will also make it easy for travellers to visit multiple cities in the GCC. This should naturally positively impact the short-term rental and holiday home market in the UAE.
Driven by rising demand and prices of short-term rental properties, global as well as local short-term rental platforms such as Airbnb, dubizzle, BlueGround, HomesGetaway and others will see substantial increases in new listings in the coming years.
Fibha Ahmed
Fibha Ahmed, sales director at dubizzle, termed the unified GCC tourist visa as a welcome announcement, one that is bound to help the region as a whole enjoy greater tourist activity.
“We already know how the Schengen visa has done wonders for tourist flow into the various European countries. A unified visa might encourage tourists from other GCC nations to explore different cities within the UAE, including Dubai. This could result in a more even distribution of tourists across the country, impacting short-term rental markets beyond traditional tourist hubs.”
The classified website dubizzle has recorded a 25 per cent surge in short-term rental listings in the UAE in 2023, with a notable 26 per cent increase specifically in Dubai, reflecting a promising trend in the market.
The new visa will also intensify competition and impact pricing strategies.
“With more tourists arriving in the UAE, holiday rentals are prone to experiencing higher occupancy rates, especially during peak travel seasons. Property owners and rental platforms could benefit from increased demand. A rise in tourism can also contribute to the local economy through increased spending on dining, entertainment, and other tourist-related activities. This economic boost will lead to overall positive effects on the real estate and rental markets,” added Ahmed.
Depending on the level of demand, she added that property owners may adjust rental prices to capitalise on increased tourist arrivals.
Plenty of offers
The tourism infrastructure is already well-developed across the GCC, especially in the UAE, with almost 11,000 hotels and almost 700,000 hotel rooms.
The GCC has set an ambitious goal of welcoming 128.7 million visitors by 2030, with the UAE leading the charge in the tourism sector. With 399 tourist sites and a plethora of events and activities that attract global attention, the UAE is a prime destination for travellers worldwide.
Short-term rentals allow property owners to manage their properties and generate additional income, making it an attractive option for many. With a growing number of travellers seeking unique and 'home away from home' experiences, the short-term rental market is expected to thrive, and more property owners may find it appealing to move into this sector.
Farooq Syed
According to Farooq Syed, CEO of Springfield Properties in Dubai, there are currently a plethora of short-term rental options available in the UAE, particularly in Dubai, including apartments, villas, and unique properties, catering to the varied preferences of travellers and providing visitors with even more choices to ensure that they find accommodations that best suit their needs and preferences.
Syed stated that the GCC tourist visa promises a positive outlook on the back of a significant increase in the tourism sector's contribution to the UAE’s economy going forward.
“We expect a surge in demand for short-term rentals. Tourists often seek a ‘home from home’ experience, and short-term rentals are exceptionally well-suited to provide precisely that.”
Syed anticipates a notable increase in short-term rental rates, particularly during peak tourist seasons and in sought-after locations.
“The convenience and accessibility offered by the unified GCC tourist visa will likely draw more tourists to the UAE and Dubai, leading to a surge in demand for short-term rental properties. Property owners and operators can adjust their rates and potentially see higher investment returns. However, the extent of the increase will vary based on individual property characteristics, location, and the broader economic landscape.”
Short-term preferred choice
According to Springfield Properties' chief executive, short-term rentals have already proven to be a preferred choice for many visitors to the UAE, and Dubai stands as a trendy hotspot. Among these visitors, you'll find those from neighbouring GCC nations, who often opt for short-term rentals for quick weekend getaways, European tourists lured by Dubai's luxury shopping and year-round sunshine, and Asian markets that appreciate the convenience and variety of available accommodations.
“Dubai's reputation as a global hub further entices tourists from every corner of the world, and many of them embrace short-term rentals as a means to enjoy a personalised and homely experience during their stay."
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Waheed Abbas
Waheed Abbas is Assistant Editor, covering real estate, aviation and other business stories that directly affect the lives of UAE consumers. He frequently reports human interest stories, too.
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