|By K Raveendran| The Dubai property market, which has of late shown strong signs of weakening, may get support from a very unlikely source.
Wealthy Chinese investors cashing out of the stock market carnage are said to be scouting for overseas property markets in leading cities to park their funds. Dubai might be one of them.
Around 20 percent has been knocked off the value of Chinese shares since mid-June and according to a Bloomberg report quoting Bank of America Merrill Lynch, major shareholders sold 360 billion yuan ($58 billion) in the first five months of 2015 alone, compared to 190 billion yuan in all of 2014 and an average of 100 billion yuan in prior years.
The report also quoted a Knight Frank source, saying there is anecdotal evidence that Chinese buyers have intensified their interest in ‘safe haven’ global property markets, including London, as a result of the recent stock market volatility.
Chinese investors have been showing an interest in Dubai properties, ever since Chinese tourists started arriving in the emirate in big numbers. Dragon Mart, developed by Nakheel, has already drawn significant Chinese investments. International City already has a large number of residential units owned by Chinese. There is a sizeable Chinese community living there. Dubai is home to about 200,000 Chinese expatriates.
Dubai is considered to be the third most preferred luxury travel destination for wealthy Chinese tourists, after Australia and France in 2014. In 2014, nearly 350,000 Chinese visited Dubai, an increase of 25% over 2013, according to data released by the Dubai Corporation for Tourism and Commerce Marketing (DTCM).
Nakheel had hired Chinese-speaking agents to field sales inquiries from Chinese investors buying homes at its Warsan development close to the International City. The gated community at Warsan Village includes 936 townhouses. Warsan Village also features a recreation centre, mosque and 250 apartments set above a retail plaza with 365 outlets.
Similarly, Damac Properties has inked a deal with a Chinese property broker to promote its 37,000 properties to Chinese investors. The Beijing-based property broker 5i5j has nearly 30,000 real estate sales professionals and is said to be capable of selling one unit per four minutes.
The Chinese interest in Dubai properties is a relatively new phenomenon as there was no Chinese involvement in the Dubai property boom that culminated in the 2008 crash.
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