Dubai is portrayed as a millionaire’s playground and the potential for a lavish lifestyle is too much for some to resist. Evidently, a lot of people had the same idea as 80% of the country’s population of 2.5 million is made up of expats.
Many assume that the cost of living in Dubai is significantly higher, but this is due to the super cars and penthouse apartments glamorised by the media. Compared to London, the cost of living in Dubai is actually 19.16% lower. Those expecting the life of global star after a move to Dubai will be sorely disappointed. Granted, there are aspects of life in Dubai that will be kind to your bank balance, but keeping a realistic frame of mind is essential. A move to Dubai will not take you from pauper to prince.
The Legatum Institute, a London-based think tank, release their global Prosperity Index annually. The survey ranks the most prosperous countries in the world. Many assume prosperity is used in reference to the financial standing of a country and, while this is included, the Legatum Institute considers more factors in its ranking.
Ranking in 30th place this year (out of 142 countries) was the United Arab Emirates as a whole. The UAE is made up of seven countries, with Abu Dhabi being the biggest. The region includes Dubai so the statistics from the Prosperity Index can be used to comment on Dubai.
This puts the UAE in the top 20%, with its rankings for governance, economy and entrepreneurship and opportunities keep it afloat. Personal freedom is the thorn in the UAE’s side, for which it ranks 65th. The UAE, including Dubai, is predominantly made up of Muslim citizens. With this comes traditions and laws to be adhered to, unlike other countries. With limitations on clothing, alcohol, and public affection, it is understandable that expats may feel restrained.
With Dubai receiving minimal rainfall and boasting average temperatures above 30°C, it is not surprising that many dream of moving to the country. But, how much does it really cost to live in Dubai?
Visitors to Dubai often marvel at the man-made islands adorning the coast, dotted with luxury villas. These eccentric creations came to symbolise the emirate’s economic boom in the mid-2000s – and the crisis that followed in 2009.
To keep up with Abu Dhabi’s oil-rich economy, Dubai diversified from the 1950s onwards. It turned its economy into ports, trade, services and finance. These were successful. However, a liquidity-fuelled binge on property development and tourism left the country in $80 billion in debt.
However, the economy has rebounded, with debts being repaid and restructured. Although not without wobbles, with property prices surging dramatically in 2014, the government has taken steps to ensure that property and the economy remain stable.
Many were shocked by Dubai’s dramatic financial crisis. They were left dumbfounded, wondering how a country in the ‘oil-rich Gulf’ could get into such a catastrophe. Although many think oil is Dubai’s biggest export, it only accounts for 6% of its revenue. However, other petroleum based products makes up a huge 60% of exports, along with gold, aluminium and other metals. Dubai mainly imports cars, jewellery and clothing.
Currency and Tax Overview
The currency used in Dubai, and the UAE, is the dirham (AED). However, it is also commonly abbreviated to Dhs or DH. There are 100 fils in a dirham. The dirham is the currency that was initially adopted in the Arab world.
Notes come in denominations of 5, 10, 20, 50, 100, 200, 500 and 1,000 dirhams. The writing on the front of the note is in Arabic while on the reverse, it is English. There are 1 and 50 dirham coins in circulation, as well as a 25 fil coin.
Many expats revel in the idea of living tax-free in Dubai. Although the country does boast tax advantages for those who live and work there, there are circumstances in which citizens will be required to pay some sort of tax. In 2010, the UAE as a whole was toying with the idea of income tax, but nothing ever came to fruition.
Indirect taxes applicable to individuals are as follows:
- 10% municipal tax applied to hotels and other entertainment facilities
- 10% municipal tax on the rental of commercial spaces
- 5% municipal tax on the rental of residential property
- Road toll
- Taxes on utility bills
- 30% sales tax on alcohol
Housing in Dubai for Expats
Compared to the UK, rent is Dubai is 3.12% lower. Burj Khalifa has the most expensive rentals in the country, but Palm Jumeriah, DIFC and Jumeriah Beach Residence are not far behind. Many expats do live in these areas, but they tend to be working jobs with higher salaries.
Garhoud has a mix of older villas, and new and old apartments. Despite being considered the less trendy side of the Dubai, expats really enjoy living here. Barsha is one of the most popular areas for expats. It starts behind the Mall of the Emirates and head out towards the Emirates Hills. The Tecom area within Barsham has many new apartments at reasonable prices.
For young and relatively well-off expats, Dubai Marina is at the heart of what has become known as ‘New Dubai’. The Marina Walk feels like one of Dubai’s better planned developments, with lots of shops and restaurants around the man-made marina. The development is populated by many freehold waterfront apartment towers.
For expats looking to buy, property prices vary depending on location. Roughly, per square meter, city centre homes are AED 17,596 (£3,596). Properties outside of the city centre are approximately AED 9,949, per square meter (£2,033).
Expat Healthcare in Dubai
It is impossible to become a permanent citizen of Dubai. If you were not born to parents who are both UAE nationals, there is no chance of obtaining residency. For this reason, expats will not be funded under the government-run health insurance scheme.
Expats wanting to use public hospitals and facilities need to apply for a health card from the Department of Health and Medical Services (DOHMS).
Expats will not struggle to find a pharmacy in Dubai as there are plenty across the emirate; most are open 24 hours a day. Medicines are generally expensive in Dubai, and it’s best to keep the receipt if planning to claim from medical aid.
We offer three private medical insurance plans to suit the needs of different expats. For example, a 30-year-old moving to Dubai can get cover with us from as little as £30 per month, to £195 per month depending on plan and excess. Visit our page on Medical Insurance in Dubai for more information.
Cost of Education in Dubai
Public schools in Dubai are not an option open to expat children. However, there are a number of private institutions in Dubai specifically catering to large foreign communities, as well as international schools.
There are schools following the British, American, French, Indian, Japanese and other national curricula, as well as the International Baccalaureate. To apply for entry to an international school, many schools will require a child’s academic record, and they may have to sit an entrance exam. Many of the international schools offer excellent educational facilities and some offer day-boarding.
Expat parents must remember to choose a school wisely as once the academic year has begun; a child cannot transfer schools. Furthermore, children will not be able to start school between 1st May and the end of June in any school year. They will have to wait until the new academic year begins.
Normal school hours are from 8 am until 1.30 pm.
All private establishments for expat children in Dubai are fee paying. There is an extremely wide variation in the fees for education, from around AED 3,000 to AED 50,000 per academic year.
For some, work in Dubai will not be an issue as they have been relocated by their employer. More than three-quarters of the work force of the entire UAE are expatriate, making it a significant employment hotspot for those with the right skills.
Those who are travelling the country often take jobs in the major industries: petroleum and petrochemicals; fishing; aluminium; construction. However, careers in education, healthcare, tourism and hospitality have recently blossomed. Major companies that are often recruiting in Dubai include DHK, Ericsson and Omnicom Media Group.
What many find attractive is that Dubai has the lowest unemployment rate in the world. Since 2015, the unemployment rate has not exceeded 0.3%.
Salary in Dubai
Many expats find that their salaries are higher in Dubai, especially when offered a relocation package from an employer. On the whole, expats are finding that their disposable income is 21.27% higher in Dubai. Therefore, they benefit from increased cash flow and more spending power. But, be warned, living costs can be steep, particularly if swept up in the initial glamour of the country. It is worth remember that it is your new home and not a holiday.
For those wishing to live in Dubai, a salary resulting in a monthly pay of AED 10,000 to AED 13,000 is relatively comfortable. However, it all depends on family size, location, and lifestyle choices.
Comparison to UK
The world’s largest database, Numbeo, has a vast selection of user contributed data in regards to Dubai. Compared to the UK, the cost of clothing is significantly more expensive, as are leisure activities. However, transportation and meals out are cheaper than the UK.
The tables below provide an over view of the differences in costs between Dubai and the UK. Please note that all Emirati prices have been converted into British pounds.
|Groceries||UK Price (£)||Dubai Price (in £)||Cheaper Country|
|White bread (500g)||£0.95||£0.94||Dubai|
|Cheese (0.10 kg)||£0.17||£0.68||UK|
|Transport||UK Price (£)||Dubai Price (in £)||Cheaper Country|
|Utilities (Monthly)||UK Price (£)||Dubai Price (in £)||Cheaper Country|
|Electricity/Heating/Water for 85m2 apartment||£143.46||£126.10||Dubai|
|1 minute of PAYG talk time||£0.13||£0.10||Dubai|
|Internet (10 Mbps, unlimited data, cable/ADSL)||£21.05||£65.41||UK|
|Clothing||UK Price (£)||Dubai Price (in £)||Cheaper Country|
|Jeans (Levi or similar)||£57.15||£68.68||UK|
|Dress (chain store)||£29.91||£45.45||UK|
|Nike running shoe||£59.40||£72.35||UK|
|Leather business shoes||£61.18||£84.17||UK|
|Leisure||UK Price (£)||Dubai Price (in £)||Cheaper Country|
|Tennis court (1 hour)||£9.99||£22.40||UK|
|Cinema (1 ticket)||£9.00||£7.13||Dubai|
|Eating Out||UK Price (£)||Dubai Price (in £)||Cheaper Country|
|Fast food meal||£5.00||£5.09||UK|
|3 course, mid-range||£50.00||£30.55||Dubai|