The property market in Dubai will soon overtake that of destinations such as Singapore, New York and London as the top choice amongst the wealthiest investors in the GCC by 2017, a report has found.
Individuals with high net worth of $1 million or above ranked London as second beside Doha and Paris in a survey of wealthy investors, while Toronto came in as a surprise No. 3.
For 2016, the top destination not in the Middle East for investors from the Gulf remains London. The capital of the UK was cited by 17% of the 127 millionaires who were interviewed for the survey. New York was chosen by 16% and Singapore by 13%.
This comes despite the property value in London reaching as high as $4,000 per square foot, which is close to three times what it costs for a high-end apartment in Marina Bay in Singapore and in Manhattan.
Price softening across the property market in Dubai was given as the top reason the increase has been seen there as well as due to the upcoming Expo 2020.
An analyst in the market said the potential the expo has for capital growth and better yields across the market means people now see very good value in Dubai for their money.
The property market in London has seen a recent slowdown during this year after having growth of more than 70% over the last seven years.
Following the Brexit vote and a drop in the value of the sterling pound, investors who have wealth in dollars have pegged the currencies such as dirham saw many thousands of pounds lost from their assets portfolio.
Because of that, property in London is 34% cheaper than more than 9 years ago, said an analyst in the London property market.
Some investors said that there is a possibility for a correction in the London market and a potential for sterling to drop even further.
So, there are some who want to take this opportunity and enter the market and those willing to sit on the sidelines and watch how everything turns out.
The rise in Doha in the ranking of investment destinations was attributed to the potential for growth due to the FIFA 2022 World Cup to be held in Qatar.
The attractiveness of Paris to the market in Qatar through a tax treaty and a purchase recently by the Qatari Investment Authority of a complex for luxury retail on Paris Champs Elysees helped increase investment potential.