Survey suggests expats in the UAE have seen their finances ease

by Ray Clancy on May 13, 2016

Expats in the United Arab Emirates are planning to remain in longer with lower house prices and living costs dropping, a survey has found.

They feel they have a brighter future as a lot of financial pressures have eased, according to a study from finance comparison website comapreit4me.com.

Last year the same survey found that more than half of expats were considering leaving the UAE due to rising costs. Some 54% said they would not consider buying a property, for example, because they did not know how long they would be staying.

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Now with both property prices and rents falling and other living costs coming down more expats are looking to buy a property and settle in the emirate.

“In March last year all the major newspapers were reporting that more than half of expats in the UAE were considering leaving due to the high cost of living,” said Jon Richards, the chief executive officer of the finance comparison site.

“Just one year later, the number of people who are interested in buying property is on the rise. It seems attitudes are changing and fears and insecurities about the future are lifting,” he added.

He pointed out that last year 56% of expats said that property prices were the main squeeze on their financial wellbeing. Residential real estate prices dropped by between 10% and 13% in 2015 and experts predict they could drop another 10% in 2016.

Richards believes that this could explain a large part of the rise in people not looking to move away. “There is no doubt that the stabilisation in the property market, which is thought to be a knock-on effect of low crude oil prices and the subsequent strength of the US dollar, must be having an impact on people’s long term plans,” he explained.

“Additionally, with the recent exciting developments, both commercially, in terms of business opportunities, and physically, with projects like the Dubai Canal, staying and committing to life in the UAE is becoming even more of an enticing option,” said Richards.

“For expats, it’s all about timing, choosing the right time to arrive and the right time to leave. The recent drop in housing prices has obviously removed a big weight from people’s minds and made settling here a more viable option,” he added.

Asked to comment on the findings in the survey, Lukman Hajje of The Propertyfinder Group said that many potential buyers have been sitting on the side-lines watching prices ease for the past 18 to 24 months trying to time the bottom of the market.

He believes property prices will reach their bottom during 2016. “Interest continues to be strong particularly from long term investors seeking excellent high single digital rental yields and end users who’ve seen their dream home come to within reach,” he pointed out.

“Moreover, the oil’s rebound in the past two months from a 14 year low of $27 per barrel to the verge of $50 per barrel early this week has given reason for optimism,” he added.

The survey report also said that the UAE’s population currently stands at approximately 9.5 million of which more than eight million are expats and is predicted to rise to 12.41 million by 2030. The population in Dubai alone is expected to double by 2030 to five million.

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