Chinese Investors Capitalize on Dubai's Growing Real Estate Market


The Dubai Land Department revealed that Chinese citizens had invested approximately AED 10,000,000  into Dubai’s real estate sector in the last four years. The DLD's database anticipates that Chinese investors will increase as Dubai's real estate market is expanding with new projects. The high demand by Chinese citizens to invest in Dubai has prompted the DLD to attend the Dubai Property Show which will take place on March 24-26th at the Shanghai World Expo Exhibition and Convention Centre in China. The DLD's attendance aims to provide insight to potential Chinese investors on leading real estate projects that offer high returns on investment in Dubai. 

An increase in Chinese investors in Dubai is an effect of the strong relations between the UAE and Chinese Government. The bilateral trade between both nations amounted to AED 176 billion in 2016 and is anticipated to increase in the future. Dubai's Chinese population is approximately 253,000. The Emirate is increasing becoming a vacation destination with nearly 100 flights from various Chinese cities to Dubai occurring weekly. Furthermore, Chinese citizens are encouraged to invest in Dubai because it offers higher rental yields in comparison to China's real estate sector.

China's rental yields have decreased significantly in several major cities. In the past, Beijing's condominiums offered potential gross rental yields of 9%. Beijing's villas would range from 9.5%-13%. Shanghai apartments would generate 5.4%-7%. Today,  Beijing's rental yields have decreased to 2.5%. Shanghai's rental yields dropped to 3.2%. In comparison, Dubai's real estate investors typically generate an 8-10% profit increase annually. Investing in a foreign real estate market decreases investment risks since the volatility of real estate markets is different in every country. Reducing investment risks is a core reason Chinese investors are purchasing property abroad as it is unlikely real estate markets in various countries will crash concurrently.




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