Earn to Live & Yearn to Leave

Teacher : what is the use of our nose?

Student: To pay for rents in UAE. My dad says he’s paying the house rent through his Nose.

Well pretty much is the case for most “Asian expats “ living in the UAE. The rents especially in the capital Abu Dhabi have reached soaring heights in recent times. The fact that I started my comment by saying Asian Expats is that all the European, Americans and the rest expats from the more “developed” countries either have their companies paying for their houses or their salaries are ridiculously high that they can easily afford the rents. One might wonder, but isn’t it the same in all the countries where expats work for a living. In my experience it is, so why should UAE be an exception.

With the ongoing unprecedented economic downturn, which effected most of the countries worldwide, Dubai was no exception, and reached a level where rumors had it that Dubai would never rise again, which is yet to be seen though. In an emirate where real estate was at a major boom, property prices where at a peak, people who cashed in at that time were the major winners, but it turned out that most people lost in the bargain. Companies merged, split, and did what they could to survive, some held on, some went deep under. Result, rents in Dubai came down to a staggering low, affordable places to live were available in plenty, so much so people in Abu dhabi now opt to commute a 2 hour journey and live in better and affordable homes.

But then why does an emirate 175Kms away from Dubai does not experience the property meltdown. Simple, Abu Dhabi is one of the richest metros in the world. It generates 55% of the GDP of the UAE. One of the worlds largest producers of oil, well then in such torment times did a pillar move? None. And so the market rulers rule everything. Not to spare the property sector. The demand being greater than the availability black marketers cash on the scenario by setting a value which does not actually exist and then slowly pushing this value for it to hold itself, and holds itself sternly into the minds of a commoner like me. The average yearly rent for one BHK would be somewhere close to 130,000 dirhams ( 16,90,000 rupees / 35500 USD), which of course is unaffordable at any levels of my sane mind. Recent reports stipulate that rents have indeed dropped in the capital due to the influx of new apartments and villas being available after completion of construction and also the fact that a considerable population is moving out of the capital into Dubai as cheaper and better quality dwellings are available. The same reports suggest a further drop in price till the year round, which definitely will be watched by me with all of my 4 eyes open. A question arises; will I still be able to afford a spacious dwelling with no external hindrances? With the value already set to a scorching unreachable value. Needs to be digged further, in a desire / need that remains to be accomplished.