Dubai may be one of the best places in the world to live and work in – but expats can find the cost of living in the city adds up to more than they expected.
Dubai, the capital of the United Arab Emirates (UAE), leads London, Paris and New York as an attractive home and workplace, according to past students of the Insead Business School who now work in 15 cities worldwide.
The city came top as the most economically dynamic, third as an attractive place to live and fourth for cost of living.
However, although another recent survey by the Economist Intelligence Unit (EIU) rated the cost of living in the city as much less than many other global cities, expats have criticised the results as misleading.
Cost of living shock
Expats claim many surveys leave out rent and private schooling costs and once they are added back, Dubai becomes one of the most expensive cities to live in.
So much so, many expats tailor their postings to end when their children reach high school age as the costs of a private education are prohibitively high, especially for families with two or more teenage children.
School fees are projected to increase by 7% in the coming year.
The hike is blamed on having to pay increasingly higher wages to attract qualified and experienced teachers to the UAE.
The findings of the EIU research, carried out for financial services firm Friends Provident, were echoed by another survey by Insight Discovery.
Luxury lifestyles
That study found the increasing cost of living in Dubai was eating up expats tax-free incomes and leaving them unable to save.
Three-quarters of financial advisers said they saw this as a threat to their clients’ lifestyle.
Rents in some Dubai neighbourhoods have surged by up to 60% in the past 12 months. As a result, many expats are moving to cheaper areas, but this is leading to a ripple effect of rising rents across the city.
Marcus Gent, Friends Provident managing director for the Middle East and Rest of the World said: “I have relocated in Dubai from Britain and relate to these findings. A tax-free income is the major attraction for coming here but a lot of expats do not have a large disposable income and many seem to fritter their cash away on a luxury lifestyle instead of saving.”
