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Cost of living in the UAE

Cost of living in the UAE

Aerial image of Dubai, UAE

The United Arab Emirates attracts foreign specialists with tax breaks, and real estate investors with high quality buildings, superbly developed infrastructure and “status”. However, the cost of living in the most cosmopolitan country of the Middle East can hardly be called low.

Budget features

The monetary unit of the United Arab Emirates is the dirham (AED), which today is roughly equal to a quarter (0.25) euro, although in fact this currency is pegged to the US dollar. Dirham (AED) consists of 100 fils.

The largest number of foreigners live in the emirates of Dubai and Abu Dhabi. In general, the cost of living in the capital of the UAE in Abu Dhabi is a quarter more expensive than living in the Russian capital. That is, to maintain the same level of comfort (including rental apartments in both capitals) in Moscow and Abu Dhabi will require € 3,400 and € 4,245, respectively. In Dubai, the cost of living is even higher: here a similar package of services will cost € 4,780 (and in the Dubai Marina elite area – even more expensive), which is 13% higher than in Abu Dhabi.

 

Many foreigners move to the UAE because of the preferential tax system: in particular, there is no income tax. According to official data from various sources, foreigners make up 80% of the total population of the UAE, and their share in the labor force of the country approaches 90%. However, before making a decision about life in the Emirates, experts advise to carefully calculate the main items of expenditure (for living and education) and compare them with their incomes.

Immigrants, mostly from South Asia (India, Pakistan, Bangladesh, Sri Lanka), who came to work in the UAE 10 years ago, note that since their arrival, wages here have remained the same, and the cost of living has increased significantly. According to the Arab newspaper The National, 56% of expats do not receive enough income to live in the UAE due to the prices of goods and services, and this issue is not only of concern to foreigners.

On average, the budget of a resident of the UAE is distributed as follows (in% of income):

• Rental housing – 56%

• Education (for yourself or children) – 13%

• Medical care and the purchase of food – at 7%

• Leisure, entertainment – 5%

• Purchase of household goods – 4%

• Transport and clothing costs – 3% each

• Other expenses – 2% 

Product prices

According to the international portal Numbeo, the cost of basic foodstuffs in the national average is:

• Milk (1 L) – AED5.48 or € 1.38

• A loaf of fresh white bread – AED4,16 (€ 1,05)

• Rice (1 kg) – AED 7.80 (€ 1.96)

• Eggs (12 pcs.) – AED9.66 (€ 2.43)

• Local produce cheese (1 kg) – AED30,42 (€ 7,65)

• Chicken fillet (1 kg) – AED25.79 (€ 6.49)

• Fruits (apples, oranges) – AED7.21- AED8.41 (€ 1.81- € 2.12)

• Vegetables (tomatoes, potatoes) – AED4,80- AED30 (€ 1.21- € 7.55)

• Drinking bottled water (1.5 liters) – AED1.75 (€ 0.44)

• A pack of cigarettes (Marlboro) – AED10 (€ 2.52)

Alcoholic beverages in ordinary retail stores and supermarkets of the UAE is prohibited to sell. Specialized stores with a license to sell alcohol are opened on the territory of the emirates. You can also bring spirits and wines with you by purchasing them in the Duty Free zone at the airport, or order bars, restaurants or hotels (the price of a bottle of beer from AED4, € 1).

Clothing, entertainment, communications

A pair of Levi’s jeans or a similar brand is AED294,14 (€ 74), a dress can be purchased for AED212 (€ 53.31), Nike sneakers for AED330 (€ 83.02), and men’s leather shoes for AED360 (€ 90.56) .

A subscription for one adult to practice at the fitness club will cost AED312 (€ 78.5), the hourly rent of a tennis court will be AED77 (€ 19.37), and one movie ticket – AED35 (€ 8.8).

One minute of a prepaid mobile tariff costs AED0.44 (€ 0.11), and the monthly fee for an Internet connection (6 Mbps speed) is AED290 (€ 72.95).

Rental and maintenance of real estate

On average in the country, renting a one-bedroom apartment costs AED6223 (€ 1,565). Thus, after payment of utilities and food costs from the average salary, the order is AED10,745 (€ 2,703). Rental housing on the coast is twice as expensive.

 

When renting an apartment of 85 square meters. m monthly utility bill is from AED700 (€ 176). The supplier of electricity and water supply is one organization DEWA, ​​whose services cost an average of AED250-AED 450 (€ 62.90- € 113). Spending money on heating the premises in the Emirates is not necessary, but the budget should certainly include the cost of paying for the air conditioner. One of the companies involved in building air conditioning is Empower. The cost of services per month varies from AED450 to AED800 (€ 113- € 200).

The tenant makes contracts with all public utilities independently and in his own name (subject to long-term lease of residential premises). Payment for garbage disposal services is at the expense of the owner of the premises.

When renting real estate, as a rule, a long-term contract is signed (from one year), and upon signing, in addition to the prepayment for the year, a security deposit is added (about 5% of the annual rent if the apartment is empty and 10% if the apartment is furnished). 5% must be paid to the real estate agency as a commission. Thus, the annual rental of a compact studio, depending on the area, will approximately cost from € 12,500 to € 22,000.

The short-term lease agreement implies that the payment already includes utilities, the opportunity to use the pool, satellite TV, Internet, etc. The guarantee fee is refundable, which is returned after the property is released. Short-term rental of one-bedroom apartments in Dubai costs from € 270 per day. 

Education

Children of foreigners cannot study at free public schools in the Emirates. In Dubai and Abu Dhabi, foreign students have the opportunity to study at one of the many private international schools or universities, which account for about 30% of the total number of educational institutions in the country. As a rule, educational institutions adhere to high standards of education, but tuition fees may not be at all budgetary, and the number of places is strictly limited. Therefore, it is important for parents to attend to the issue of children’s education as soon as possible.

For example, pre-school preparation costs from AED7000 (€ 1,761), the cost of education in the lower grades is from AED45,000 (€ 11,322), education in the upper grades costs about AED90,000 (€ 22,640) per year. In some educational institutions, you must additionally pay for the school bus, school uniform and study materials.

To avoid such high costs of education, which have recently only increased, many parents make a choice in favor of home schooling for children.

Transport

A one-way fare on public transport costs AED4.5 (€ 1.13), and a monthly ticket is AED200 (€ 50.30). Dubai Metro is considered one of the best in the world. Created using the most modern technologies, it is not only very beautiful, but also extremely comfortable and inexpensive. The route runs along the perimeter of the entire city. Soon a new metro line will also appear on the territory of Discovery Garden and the residential area of ​​Al Furjan. In the area of ​​Dubai Marina laid new tram lines. But mostly in the country, most residents move by car.

An average cab ride in the country costs AED5 (€ 1.26) for boarding and AED2 (€ 0.5) per kilometer.

The purchase of a new Volkswagen Golf type car or its equivalent will cost AED70,000 (€ 17,610), and a liter of fuel costs AED1.75 (€ 0.44). Car rental starts at AED1500 (€ 377) for a small hatchback.

Medical service

The health care system in the UAE is upscale. Modern medical facilities are equally accessible to both locals and expats. However, it is worth remembering that foreigners in the UAE must have medical insurance; in some emirates, the obligation of the employer to insure employees is enshrined in law. For example, in Abu Dhabi, the availability of health insurance is a prerequisite for obtaining a residence permit and is fully funded by the employer.

Source: https://www.homesoverseas.ru/articles/5760

112

Aziz Kamekov

Leading Real Estate Specialist in Dubai
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