Dubai is becoming a less expensive city to live in

June 27, 2018
Mercer survey on cost of living shows city dropping from 19th to 26th on list of most expensive cities

The rental declines over the last 12 months are starting to pay off for Dubai’s residents.

A global survey by the consultancy Mercer finds that cost of living has come down, thus ensuring Dubai’s drop from 19th to the 26th spot on the list of most expensive cities. But when compared to other cities within the region, Dubai is still costlier.

“Given that rental prices are a significant factor in cost of living for expats in particular, the overall cost of living decreases as well,” the report finds.

“Rent for a two-bedroom apartment of international standards costs an average of $2,995 (Dh11,000) in Dubai, while it costs an average of $5,700 in New York and $4,335 in London,” the Mercer report notes. “One litre of gasoline in Dubai costs $0.61 while it costs $0.70 in New York and $1.65 in London.”

The cost declines elsewhere have also managed to offset the introduction of value-added tax (VAT) earlier this year.

Another factor that has helped Dubai’s cause is the “depreciation of the dollar and dirham versus several major currencies the last 12 months.”

The findings carry clout when it comes to global businesses deciding where to base their regional operations and what sort of headcount they ought to have there.

According to Rob Thissen, senior associate at Mercer in Dubai and the executive responsible for Global Talent Mobility Services, “Given the decreased relative cost of living in Dubai compared to other cities, the UAE continues to be an attractive country for expat employees.”

The only country in the Middle East that has bucked the cost of living decline is Saudi Arabia, where subsidy cuts and have had an impact “to such an extent that Riyadh has moved up the ranking from the 52nd to the 45th spot”.