Desert Phoenix

Dubai has bounced back from its post- 2008 property crash. Peter Shadbolt assesses a market in which Chinese investors are showing increasing interest

nce reporters were sent to count the lights at night at Dubai’s luxury Jumeirah Beach Residence as a gauge of the scale of the emirate’s property crash after 2008. The city staggered out of the downturn bruised, property prices slashed by up to 60 per cent. The market had recovered by 2012, only to teeter once more, the International Monetary Fund warning a bubble was forming unless prices stabilised.

Government regulation and increasing supply have since cooled one of the world’s hottest property markets. Considering the volatility in the United Arab Emirates’ equity markets, the strengthening US dollar and the effect of lower oil prices, Dubai might still seem to be off its best. But with moderate corrections of 9.5 to 12 per cent in the property market, Dubai’s lights are slowly blinking back on, albeit cautiously.

South Asian, British, and Chinese investors are now viewing the emirate favourably as its economy matures and its demographic expands. Recent figures from the Dubai Land Department show Chinese investors make up two per cent of the expat residential property investor market. Emiratis are the largest group, at 20 per cent, followed by Indians at 15 per cent, and Brits at 10 per cent. With attractions such as the Louvre and the Guggenheim due to open within the next few years in nearby Abu Dhabi, Dubai is likely to become an even bigger draw for the 300,000 Chinese that currently visit every year.

“It’s not just interest in villas and homes,” says Craig Plumb, head of Middle East and North Africa research at JLL. “There’s an