Chinese investments in the UAE real estate sector will increase in the coming months and are expected to exceed more than 70 percent by the end of 2019, reinforcing the solid growth in investments with foreign capital in the country.
Chinese investments have experienced an increase of 64% between 2016 and 2017 and this trend has continued during 2018 and the first quarter of 2019. Currently, Chinese investors are among the four main nationalities that have invested in Dubai with a volume of investments total of AED 1,700 million in Dubai in the first nine months of 2018. In order to boost Chinese investments in the country, DLD also opened its two representative offices in China in the past two years, including Beijing last June, and aims to open a third in the industrial city of South Shenzhen among other regions.
Chinese investors are looking to invest abroad to diversify. Since the prices of real estate in the UAE and Dubai are much lower than in China, together with the fiscal structure and other incentives, they make the UAE one of the best global markets to invest. Recent residence ownership laws that allow non-Emirati entrepreneurs to establish their base in Dubai is also a big boost for Chinese investments.
Other economic factors also contribute to the increase of Chinese investments in the UAE and the real estate sector in Dubai. These include the current trend of the real estate and securities markets in China, the depreciation of the Chinese Yuan and the advantages of the real estate market in Dubai, which include absolute ownership, high rental yields, affordability and investments free of taxes.
The number of Chinese expatriates in Dubai has increased by 53% in the last five years, with about 230,000 Chinese citizens currently living in the Emirate and around 4,000 Chinese companies operating in Dubai.
With Expo 2020 only a few months away, Dubai’s status as an investment destination is also on a growth trajectory for Chinese investors.