UAE cost of living declines on property downturn
The cost of living and working in the UAE has declined in the last year as a result of the downturn in property prices, according to the Kershaw Leonard 2010/2011 begin_of_the_skype_highlighting 2010/2011 end_of_the_skype_highlighting UAE Cost of Living Report. The report provides detailed information on accommodation, education, healthcare and other essential expenses, along with up-to-date salary information across all sectors. It is the seventh cost of living report undertaken since 2004 by Kershaw Leonard, the Dubai-based HR and recruitment consultancy.
Kershaw Leonard's Managing Partner Mike Hynes said, "This report reveals a dramatic readjustment in key cost of living indicators as a result of the global economic downturn and an oversupply of housing stock. Freehold prices for both villas and apartments in Dubai have fallen by as much as 40 per cent in Dubai in 2010 and tighter bank lending rules seem certain to limit the extent of any short-term rebound.
"Villa and apartment rents in Dubai and Abu Dhabi have also fallen by similar amounts. However, while freehold property prices appear to be levelling out and in some cases making some modest gains, rental prices are still heading southbound."
For example, rents for a three-bedroom apartment in Dubai currently range from AED 80,000 to AED 180,000, a steep fall from the highs of two years ago. A three-bedroom apartment in Al Barsha can now be rented at 17 per cent less than in September 2009. The report also highlights the disparity in rental costs between Dubai and Abu Dhabi where a three-bedroom apartment may cost anywhere between AED 135,000 and AED 240,000.
Despite the decline in accommodation costs, education, healthcare and household utility costs remain at high levels making Abu Dhabi and Dubai among the most expensive places to live in the GCC. According to the report, many private schools in the UAE have continued to raise their fees to the maximum permissible levels. School fees are at their highest in Dubai where annual fees for an International Baccalaureate school can exceed AED 90,000.
The Kershaw Leonard report is designed as a valuable tool for HR professionals and other decision makers who need up-to-the-minute data for formulating plans and policies. "The past twelve months have demonstrated just how quickly trends can change," Mike Hynes said. "The UAE Cost of Living Report now has seven years of historical data on which to base comparisons and make predictions. In addition, the report provides informed commentary and insights from leading industry sources."
The report assesses the impact of cost of living fluctuations on three typical real-life examples. The scenarios used include an Asian expat family living in Sharjah, a single young advertising executive living on Sheikh Zayed Road in Dubai and a Western expat family owning a home in The Meadows. These timeless examples have been used consistently by Kershaw Leonard since the first Cost of Living Report in 2004.
The 100 page report is accompanied by comprehensive, easy-to-reference cost tables indicating where costs have risen or fallen, with a year-by-year comparison leading back through the UAE's colourful economic history.