Although London remains the number one location for GCC investors outside of the region, Dubai is emerging as a popular destination, according to UK real estate company Cluttons’ 2016 Middle East Private Capital Survey.

The rise of Dubai’s status as a destination for regional investors is due to the city’s ability to offer attractive yields, but it is also related to sentiment. In the report, 47 per cent of people felt the global economy was worsening. Interestingly, when asked about the health of local economies, three-quarters felt domestic markets in the GCC were stable or improving.

“Confidence in the UAE and other regional economies has been the underpinning factor in driving the desire to look to home markets for real estate investment opportunities before looking overseas,” says Faisal Durrani, head of research at Cluttons.

According to data from Dubai Land Department, GCC nationals were the largest investors in Dubai real estate in 2015 with a total of $4.9bn, excluding UAE nationals. The biggest GCC investor group was Saudi Arabia, which contributed $2.4bn to Dubai real estate in 2015.

London, New York and Singapore remain the top three targets for GCC investors looking at international property markets, according to the survey. London topped the list of the most favourable international locations, with $5bn invested by Middle East commercial investors in the city during 2015.

The UK’s vote to leave the EU in mid-June has resulted in the weakening of the British pound against regional currencies, most of which are pegged to the dollar. As a result, Cluttons has estimated that properties have lost their value by an average of 10 per cent following the currency correction.

Durrani does not expect investors to not deterred by the UK’s decision to leave the EU and the consequences that decision will have on its real estate market. At the same time, he also expects GCC investors to look at home markets more, with Dubai seen as the most preferred destination, which could soon position the emirate as the leading destination for investment.