Chinese Investors Step-Up into Dubai Real Estate
Dubai has become one of the top investor destinations for Chinese investors. More than 200,000 Chinese expatriates live in the United Arab Emirates (with over 80 percent of headquarters in Dubai), and there are over 4,000 Chinese firms. There is little doubt that they are now among Dubai’s top international investors.
In the first three quarters of 2018, the Dubai Land Department (DLD) reported that Chinese citizens invested over Dh 1.7 billion, making them the sixth most excellent national investment. More cheap condos are likely to increase investment this year.
One of the drivers of this development is that the UAE and China have built substantial bilateral commercial connections in recent years. The trade between the UAE and China alone amounted to more than AED 176 billion in 2016. In addition, the UAE government declared that more than 100 Dubai schools would feature Chinese as the third primary language.
Downtown Dubai, Greens & International City are Chinese investors’ most popular destinations. They buy both off-plan and ready properties and assess annual returns, prices, and location during the decision-making process. The key incentive is annual returns ranging from 6% to 10%, compounded by the average selling price of Dh 700 per sq. ft–Dh2,200 per sq. ft amounts to 1/4 of the Downtown Shanghai, China.
When discussing the inclination for property investments, Mrs. Black said that Chinese investors are driving the city’s off-plan real estate market rather than ready properties. The flexibility of payment plans can be attributed to this due to investments in off-schedule buildings in Dubai – investors need not worry about taking out a mortgage; payments can be made constantly throughout five, six, and in some cases, seven years according to developers’ offer. Lee stated that payment plans do not exist in China – property investors have to pay mortgages in advance when investing, which is not easy for many investors.
Dubai is recognized for its many new properties being offered each week for sale. Regarding Chinese real estate investment, the property’s location is a significant factor, apart from flexible payment options. Black believes that the iconic tourism hub of downtown Dubai is the most preferred destination for property investment for Chinese investors. This is followed by Dubai Marina’s waterfront community – because rentals are in high demand. Also famous for Chinese investment in Dubai is Dubai Creek Harbour.
Chinese corporations are also active in the Dubai construction industry, in addition to real estate investments. Chinese building firms are among the top five UAE contractors. Not only have that, but the majority of these companies also provided building finance and loans. These companies can be found in commercial spaces for rent throughout Dubai. The China State Construction and Engineering Corporation is the second-largest contractor, to give you an example. Their initiatives amount to up to $3 billion, and they currently have 16 projects in the United Arab Emirates.
Consider this: Chinese enterprises hold around 6 percent of the overall value of construction contracts in the UAE. The figure in Dubai is significantly higher, reaching 7%. It is projected that this figure will climb to 9 percent by 2020. As local real estate organizations consider China a lucrative outlet for possible purchasers, they link relationships with China-based brokers. As a result, there are continuous marketing camps, exhibitions, and road shows in China with residential and commercial property in the UAE for sale.
There is no doubt that the Dubai real estate outlook is strong. The real estate market is likely to increase with more investors arriving in the country. If you wish to benefit from this predicted rise in the market, it is advisable to begin steps now. Fortunately, you’re here at Fajar Realty. Professional property brokerage and consulting services are provided to assist you in making the correct selections. We have some of the greatest immobilizers in Dubai with the proper experience, understanding, and competence. We explore your options as a buyer/seller and advise you every step of the way.
The future of Chinese investment in Dubai real estate
The increased number of Chinese investors in Dubai is good for the market, particularly as Expo 2020 approaches. In 2018, Emaar also stated that it would build the most prominent Chinese neighborhood in the Middle East, as announced in conjunction with the historic visit to the UAE of Chinese President Xi Jinping. Lee and Black both talked about how warmly Chinese investors received this idea. Black said numerous investors approached Huaxia Real Estate after announcing investments in Emaar’s zone in Chinatown.
Dubai was now seeking Chinese real estate investments through AED 1B in 2019. Not only does this program stimulate investment by Chinese property developers in Dubai, but it also offers avenues for numerous UAE developers to expand into China. With so many outstanding events, China’s investment in the real estate market in Dubai is likely to be followed by an increase in the urban economy. Both Lee and Black look forward to 2019 and vow to provide the most significant investment support for investors in China and other countries.