Decline Noticed in Investment in UAE Property Market
According to figures released by Dubai Land Department (DLD), the share of Pakistani investors in the Dubai property market in 2016 reached at around AED4.4 billion – which is 42.8 percent less as compared to previous year values. It is learnt that with the investment amount of AED4.4 billion in 2016, the investment of Pakistanis in Dubai property market since 2013 reached AED28.4 billion.
"The year 2016 saw foreign investment in the Dubai real estate market approaching AED 44 billion, from 22,834 investors of 136 nationalities," said the DLD report posted on its website. "Indian nationals rank highest in terms of both volume and value, making AED 12 billion worth of property transactions across 6,263 investors. Pakistan contributed AED 4.4 billion worth of property transactions across 3,372 investors, while British investment totalled AED 5.8 billion from 3,372 investors," it added further.
In 2015, Pakistanis bought more than 6000 properties worth around AED 8 billion in Dubai, the financial and commercial capital of United Arab Emirates.
The biggest reason behind the decline in the investment of Pakistani citizens seems to be a fear that the UAE government would share their bank and investment details with the Pakistani government. As per one of the real estate agents, the investors are scared to invest their money in Dubai real estate, not due to fear of low returns but because the UAE government will share their investment details with the Pakistani government – so they preferred moving their capital from Dubai to Pakistan real estate sector.
UAE banks had started communicating to their foreign customers regarding implementation of a new global transparency policy from January 1 – under which details regarding their bank accounts, interest, dividends or income earned outside their native country would be exchanged with their home country in a move to fight cross-border tax evasion.
Now after moving their money back from foreign investment sector, most of the wealthy investors are investing their money in Pakistan realty sector. As investors are showing confidence in Pakistan real estate sector, resultantly, Pakistani economy is improving. Moreover, the country' s realty sector is offering hefty returns, so people prefer investing here.
Even the real estate crisis over valuation of properties by the Federal Board of Revenue (FBR) did not see the flight of capital from Pakistan to overseas.