While grandiose visions of tax-free wealth lure expats to the United Arab Emirates in droves, it is worth remembering that the cost of living in Dubai is rather high. The city ranks as one of the most expensive in the Gulf Region and was placed at 23rd out of 209 cities around the world in the Mercer Cost of Living Survey for 2020, ranking 16 spots higher than its neighbouring emirate of Abu Dhabi. 

There are no taxes on salaries or wages in Dubai, and sales tax is, for the most part, minimal. Despite the favourable tax climate, living expenses can add up, and many expats find themselves spending money on luxuries that they would not normally have splurged on back home. Accommodation, transport and education are the biggest expenses expats living in Dubai are likely to encounter. In the past, many expats have been able to reconcile these costs by stipulating subsidies and allowances in their expat contract, but nowadays these perks aren't as easy to come by. Still, we recommend expats try their best to negotiate such inclusions as housing and school fees, where possible.


Cost of accommodation in Dubai

Although prices have stabilised somewhat with more and more real-estate developments springing up, the cost of accommodation in Dubai remains expensive. Landlords could even sometimes require rent to be paid upfront in advance for a year. Utilities are reasonably priced, but constant air conditioning can add to the cost, especially in the hot summer months.

Having arrived in Dubai, many people also find they can afford additional luxuries in their home, such as domestic help and childcare, due to the somewhat inflated salaries. It is commonplace for families to have a nanny and a housekeeper, and others may also have gardeners and drivers. Most villas have small maids' quarters attached. Families who choose to employ a maid are responsible for paying their residence permit costs and healthcare in Dubai.


Cost of education in Dubai

Public schools in Dubai are not usually an option for expats, but there are plenty of international schools in the emirate. Fees for international schools can be exorbitant and are continually on the rise.

Many expats choose to homeschool their children to avoid the astronomical pricing structures, especially if their stay is short.


Cost of transport in Dubai

Having a car is the fastest and cheapest way of getting around Dubai. As petrol and maintenance prices are greatly reduced, many expats find they are able to buy cars that are a better make and model than what they would be able to afford at home. Hiring a car is also an option.

Catching a bus or taxi is also a possibility, while Dubai’s metro system also offers expats a reasonably priced transport option.


Cost of food and household goods in Dubai

Groceries in Dubai are reasonably priced compared to other cities, but imported products can be very expensive.

With Dubai’s extensive malls, expats will likely be doing more shopping than they ever did before. Gadgets, international fashion brands and everything else in between is on offer in these massive shopping centres. Expats who enjoy shopping will relish the Dubai shopping festival where all sorts of bargains are to be found. In general, due to low import duties, household electronic goods are reasonably priced, but clothing can still be expensive.

Food is relatively well priced in Dubai, and with a variety of eating establishments catering for all budgets, it’s easy to eat out on a regular basis in the emirate. Many bars and restaurants also have happy hours and special deals. While food is generally reasonably priced, alcohol is expensive.


Cost of living in Dubai chart

Note that prices may vary depending on product and service provider. The list below shows average prices for June 2020.

Accommodation (monthly)

One-bedroom apartment in city centre

AED 5,700

One-bedroom apartment outside of city centre

AED 3,700

Three-bedroom apartment in city centre

AED 11,500

Three-bedroom apartment outside of city centre

AED 8,000

Groceries

Eggs (dozen)

AED 10.50

Milk (1 litre)

AED 6.10

Rice (1kg)

AED 6.60

Loaf of white bread

AED 4.80

Chicken breasts (1kg)

AED 27

Pack of cigarettes (Marlboro)

AED 23

Eating out

Big Mac Meal

AED 26.50

Coca-Cola (330ml)

AED 3.70

Cappuccino

AED 18.20

Bottle of beer

AED 45

Three-course meal for two at a mid-range restaurant

AED 210

Utilities

Mobile to mobile call rate (per minute)

AED 0.57

Internet (uncapped ADSL or cable average per month)

AED 359

Basic utilities (per month for a small apartment)

AED 645

Transportation

Taxi rate (per kilometre)

AED 2

Bus/train fare in the city centre 

AED 6

Petrol/gasoline (per litre)

AED 2.23

Expat Health Insurance

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