Cost of Living in Abu Dhabi
The cost of living in Abu Dhabi can be steep and is only predicted to become steeper as the emirate’s oil-exporting economy continues to thrive. Though many move to Abu Dhabi to save money in the tax-free environment, expats shouldn't let delusions of grandeur go to their heads before negotiating their contracts.
Salaries in Abu Dhabi have come down from former dizzy heights, and many of the allowances included in expat packages of the past are no longer normal protocol. That said, with the right kind of research, expats can accurately estimate their costs and take the appropriate steps to wrangle for a better wage and the lifestyle they may have imagined.
As is the case anywhere, an individual's cost of living in Abu Dhabi is highly variable; the opportunity to live a life of opulence exists, as does the chance to get by cheaply and conveniently.
One unfortunate reality of the emirate is that nationality plays a primary role in asserting what kind of salary you're able to earn. Bear in mind that Emiratis will always exist at the top of the pyramid, and at no fault of their own, South Asians will make up the lowest tier. Western expats fall somewhere in the middle.
Accommodation, automobiles, and for those with kids - schooling, comprise the bulk of expenses, while food, clothing and entertainment are generally affordable, depending on your tastes.
According to the 2010 Mercer Cost of Living Survey Abu Dhabi is the 50th most expensive city in the world, alongside well-known European cosmopolitan centres, like Barcelona and Frankfurt.
No matter your social status, the costs associated with accommodation in Abu Dhabi are outrageous. Though rental rates have declined slightly since peaking in 2008, expats should anticipate their largest expense to be housing; rent can take up nearly 50 percent of a monthly salary.
On-island accommodation is generally more costly than off-island accommodation, as is the case with furnished and unfurnished housing, respectively.
Single assignees should either negotiate a housing allowance of at least the equivalent of 2000 USD per month, or should make sure their salary is proportionately inflated to cover this cost. Families will need to haggle for more, depending on their size.
Don't forget to broach the subject of a shipping allowance, or for those planning to buy most of their household goods upon arrival, a start-up stipend.
Utilities are reasonably priced in Abu Dhabi, as they're subsidised by the government. However, they're nonetheless for an expat's account, so be prepared to pay, especially if you plan to keep a garden and an air-conditioned villa.
Flat-sharing is a good solution to exorbitant rental rates, but do be careful of renting a room in a villa that's been divided; this is illegal in Abu Dhabi.
Alongside accommodation, the cost of renting or buying an automobile will likely be an expat's highest expense.
Public transport is available and economical. Buses cost a single Dirham and private taxis are roughly the same per minute; still,
most who have relocated to Abu Dhabi prefer to use a car to get from point A to point B.
Rental prices for a small to medium, modest vehicle fall just above or below 2500 AED per month; luxury vehicles will be much more. Monthly payments decrease as the lease period is extended. For those who plan to buy, a newer-model used SUV or a mid-range used BMW will cost roughly 100,000 AED.
One option that can save a good deal of money is to ship your car to Abu Dhabi. Costs vary depending on the location of your home country, and import duties must be paid, but on the whole, if planning to stay in Abu Dhabi for a year, the total cost of both import and export will be significantly less than leasing or buying a car in the emirates.
One unforeseen cost that's impossible to anticipate, but readily avoidable is the outrageous cost of parking and speeding tickets in Abu Dhabi. In an effort to curb illegal behaviour the authorities have attached hefty fines to these violations. Parking tickets are 200 to 300 AED and speeding tickets are 300 to 400 AED.
Expat parents with children must certainly work hefty tuition fees into the annual budget. The little ones won't be able to attend the free public school system, and the private international schools charge an 'arm and a leg' for an education, that some westerners feel, is hardly worth the extravagant price tag.
Tuition does range considerably, but the best schools levy fees that amount to roughly 70,000 AED per year. Regardless though, count on paying at least 50,000 AED.
Assignees should try to negotiate an allowance into their salary package. Though, education stipends are less common, they still do exist.
In Abu Dhabi, employers are legally required to provide expats with health insurance. So luckily, this is one cost assignees won't need to concern themselves with. That said, some employers use local health insurance, which is not recommended for those at-risk individuals who have significant health issues.
If you are older or in poor health, you may need to maintain health insurance in your home country and make sure your employer finances emergency evacuation insurance. Otherwise, local health care is up to standard for minor issues.
Food and clothing costs have the potential to monopolise great portions of your salary, or to cost you next to nothing. There's an
impressive assortment of cuisine and shopping options in Abu Dhabi, and expats must merely decide how much they'd like to spend to look stylish and to feel full.
Local food stuffs will always be more reasonably priced than imported goods, and ethnic-style (Indian, Arabic, Chinese and African) restaurants much cheaper than hotel eateries and bars. Organic food and western brands can summon a significant grocery bill, so don't be afraid to try the Emirati equivalents to cut costs.
Furthermore, alcohol is expensive, so if you remember, try and buy duty free in the airport. The cheapest bottle of wine, a close kin of vinegar, is just under 35 AED; a decent bottle can levy costs of anywhere from 75 AED and up.
Clothing from the Carrefour and the downtown shops is incredibly affordable, while the big names and popular labels found in Abu Dhabi's malls will be expensive. Books and electronics also tend to be pricier than expats may be used to, and as a result, many purchase these goods during the odd trip home.
For those expats lucky enough to be lured abroad by lucrative expat packages with multiple allowances included, it's vital your work contract includes a tax equalisation stipulation. Essentially, taxes will be deducted for all these generous additions, and you should make sure your company covers this income tax or pays you an extra amount to make sure you come out even.
Salaries in Abu Dhabi have come down from former dizzy heights, and many of the allowances included in expat packages of the past are no longer normal protocol. That said, with the right kind of research, expats can accurately estimate their costs and take the appropriate steps to wrangle for a better wage and the lifestyle they may have imagined.
As is the case anywhere, an individual's cost of living in Abu Dhabi is highly variable; the opportunity to live a life of opulence exists, as does the chance to get by cheaply and conveniently.
One unfortunate reality of the emirate is that nationality plays a primary role in asserting what kind of salary you're able to earn. Bear in mind that Emiratis will always exist at the top of the pyramid, and at no fault of their own, South Asians will make up the lowest tier. Western expats fall somewhere in the middle.
Accommodation, automobiles, and for those with kids - schooling, comprise the bulk of expenses, while food, clothing and entertainment are generally affordable, depending on your tastes.
According to the 2010 Mercer Cost of Living Survey Abu Dhabi is the 50th most expensive city in the world, alongside well-known European cosmopolitan centres, like Barcelona and Frankfurt.
Cost of accommodation in Abu Dhabi
No matter your social status, the costs associated with accommodation in Abu Dhabi are outrageous. Though rental rates have declined slightly since peaking in 2008, expats should anticipate their largest expense to be housing; rent can take up nearly 50 percent of a monthly salary.
On-island accommodation is generally more costly than off-island accommodation, as is the case with furnished and unfurnished housing, respectively.
Single assignees should either negotiate a housing allowance of at least the equivalent of 2000 USD per month, or should make sure their salary is proportionately inflated to cover this cost. Families will need to haggle for more, depending on their size.
- Two-bedroom apartment in the Corniche - 140,000 to 170,000 AED per year
- Two-bedroom apartment in Central Abu Dhabi - 120,000 to 140,000 AED per year
- Two-bedroom apartment in Raha Beach - 140,000 to 180,000 AED per year
- Semi-detached 5-bedroom villa - 310,000 to 350,000 AED per year
Don't forget to broach the subject of a shipping allowance, or for those planning to buy most of their household goods upon arrival, a start-up stipend.
Utilities are reasonably priced in Abu Dhabi, as they're subsidised by the government. However, they're nonetheless for an expat's account, so be prepared to pay, especially if you plan to keep a garden and an air-conditioned villa.
Flat-sharing is a good solution to exorbitant rental rates, but do be careful of renting a room in a villa that's been divided; this is illegal in Abu Dhabi.
Transport costs in Abu Dhabi
Alongside accommodation, the cost of renting or buying an automobile will likely be an expat's highest expense.
Public transport is available and economical. Buses cost a single Dirham and private taxis are roughly the same per minute; still,
most who have relocated to Abu Dhabi prefer to use a car to get from point A to point B.Rental prices for a small to medium, modest vehicle fall just above or below 2500 AED per month; luxury vehicles will be much more. Monthly payments decrease as the lease period is extended. For those who plan to buy, a newer-model used SUV or a mid-range used BMW will cost roughly 100,000 AED.
One option that can save a good deal of money is to ship your car to Abu Dhabi. Costs vary depending on the location of your home country, and import duties must be paid, but on the whole, if planning to stay in Abu Dhabi for a year, the total cost of both import and export will be significantly less than leasing or buying a car in the emirates.
One unforeseen cost that's impossible to anticipate, but readily avoidable is the outrageous cost of parking and speeding tickets in Abu Dhabi. In an effort to curb illegal behaviour the authorities have attached hefty fines to these violations. Parking tickets are 200 to 300 AED and speeding tickets are 300 to 400 AED.
Cost of schooling in Abu Dhabi
Expat parents with children must certainly work hefty tuition fees into the annual budget. The little ones won't be able to attend the free public school system, and the private international schools charge an 'arm and a leg' for an education, that some westerners feel, is hardly worth the extravagant price tag.
Tuition does range considerably, but the best schools levy fees that amount to roughly 70,000 AED per year. Regardless though, count on paying at least 50,000 AED.
Assignees should try to negotiate an allowance into their salary package. Though, education stipends are less common, they still do exist.
Cost of health insurance in Abu Dhabi
In Abu Dhabi, employers are legally required to provide expats with health insurance. So luckily, this is one cost assignees won't need to concern themselves with. That said, some employers use local health insurance, which is not recommended for those at-risk individuals who have significant health issues.
If you are older or in poor health, you may need to maintain health insurance in your home country and make sure your employer finances emergency evacuation insurance. Otherwise, local health care is up to standard for minor issues.
Cost of food and clothing in Abu Dhabi
Food and clothing costs have the potential to monopolise great portions of your salary, or to cost you next to nothing. There's an
impressive assortment of cuisine and shopping options in Abu Dhabi, and expats must merely decide how much they'd like to spend to look stylish and to feel full.Local food stuffs will always be more reasonably priced than imported goods, and ethnic-style (Indian, Arabic, Chinese and African) restaurants much cheaper than hotel eateries and bars. Organic food and western brands can summon a significant grocery bill, so don't be afraid to try the Emirati equivalents to cut costs.
Furthermore, alcohol is expensive, so if you remember, try and buy duty free in the airport. The cheapest bottle of wine, a close kin of vinegar, is just under 35 AED; a decent bottle can levy costs of anywhere from 75 AED and up.
Clothing from the Carrefour and the downtown shops is incredibly affordable, while the big names and popular labels found in Abu Dhabi's malls will be expensive. Books and electronics also tend to be pricier than expats may be used to, and as a result, many purchase these goods during the odd trip home.
Tax Equilisation
For those expats lucky enough to be lured abroad by lucrative expat packages with multiple allowances included, it's vital your work contract includes a tax equalisation stipulation. Essentially, taxes will be deducted for all these generous additions, and you should make sure your company covers this income tax or pays you an extra amount to make sure you come out even.
