What’s the average cost of living in Dubai?

Dubai tourists usually talk about two things: how impressive everything is and how expensive everything is. Yet in terms of living expenses, the UAE’s capital is competitive with most other cities of its size in the world. In fact, on those “most expensive cities” lists, Dubai often barely cracks the top fifty.

If you’re considering making an international move to Dubai or another city in the United Arab Emirates, there are a few things you should know. First, the path to citizenship, or lack thereof, will be a tricky one. People from Saudi Arabia, Oman, and other GCC (Gulf Coast Country) states, have a relatively easy path to citizenships. But Americans and most other foreigners are only eligible after a thirty-year waiting period.

For expats living in Dubai, international money transfer fees are among the largest expenses. But they’re far from the only expense. For those of you considering a move to the UAE, here are some of the expenses you can expect when living as an expat in Dubai.

First: the currency conversion

Before we look at individual expenses, it’s important to set the approximate value of the dirham, which is listed as the AED (Arab Emirate Dirham) on most of the world’s currency exchange floors.

Currency exchange varies, but for the purpose of this article, we will be utilizing rates provided by Google (whose data is provided by Morningstar) on November 25th around 3pm EST. Per these rates, one AED is worth about 3.5 U.S. dollars, 4, euros, and 4.5 British pounds. 

For both incoming and outgoing transfers, people pay more than currency conversion rates. As mentioned, there are other transfer fees as well. But the rest of this post will deal with domestic expenses in Dubai.

Educational expenses in Dubai

Most people permanently relocate to the UAE capital because they want a better life for their children. So, most expats are deeply concerned about educational costs. 

Culturally, there are so many expats and foreign workers in Dubai that it is rather easy to find a school that conducts classes in your home country’s language and focuses on your home country’s heritage. International schools are quite popular as well. 

Many Western countries have free schools, at least through age 18. But Dubai’s schools are not free, and they are not particularly cheap. Most good primary and secondary schools cost the equivalent of about $3,000 USD a month. Undergraduate tuition at Dubai University is about $244,000 USD a year.

Transportation and travel costs

The UAE was built on oil, so not surprisingly, gasoline is relatively cheap and plentiful in Dubai. However, over three million people live in a relatively small area. So, Dubai is also rather crowded and congested, meaning the brand new public transportation system (almost everything is brand new in Dubai) is often an effective and safe alternative.

Gasoline usually costs about Dh1.8 per liter (there are four liters in a gallon). A monthly transit pass costs about Dh250. As for vehicles, a 2021 Corolla usually costs around Dh65,000. You probably don’t want anything much bigger than that. Dubai residents do not normally do road trips, unless they enjoy driving through endless desert.

Healthcare costs in Dubai

The oil-rich UAE has one of the best healthcare systems in the world. Much like the school system, services are available in many different languages. The government issues healthcare subsidy cards which entitle users to some free (or more precisely prepaid) services. A few expats are eligible for these cards. Even if you get a card, private health insurance is usually a good idea, especially for families. 

Generally, health insurance plans cover most medical services. Patients must normally meet a deductible or pay a copay. 

Uninsured costs are usually around Dh275 for a well checkup (no labs), Dh20 for a week’s supply of over-the-counter cold medicine, and Dh100 for a prescription antibiotic.

Accommodations and housing costs

Location matters a lot in real estate. That’s especially true in Dubai. Housing in the city center or in one of the nearby designated expat areas is often expensive. The further out one goes, the lower the prices drop. There’s usually a dropoff in quality as well, but it is not that noticeable.

A one bedroom apartment in the city center usually costs about Dh7,300 a month. That’s a lot of money, but less expensive than a one bedroom in midtown Manhattan. Go a few dozen blocks in any direction, and rent usually runs about Dh5,000 a month. Utilities (internet, electricity, water, etc.) usually cost about Dh1,000 a month.

Comparing the cost of living in Dubai to other major cities

As mentioned, tourists spend lots of money in Dubai, but living expenses are competitive with some of the world’s other major cities.

The cost of living in Dubai (in AED)

• 1BR apartment - 7,300

• Nice dinner for two - 150

• Monthly transit pass - 250

The cost of living in Sydney (in AED)

• 1BR apartment - 7,200

• Nice dinner for two - 250

• Monthly transit pass - 450

The cost of living in Berlin (in AED)

• 1BR apartment - 3,000

• Nice dinner for two - 175

• Monthly transit pass - 350

The cost of living in New York (in AED)

• 1BR apartment - 11,000

• Nice dinner for two - 275

• Monthly transit pass - 450

The cost of living in London (in AED)

• 1BR apartment - 8,000

• Nice dinner for two - 250

• Monthly transit pass - 600

The UAE’s capital is lower in almost every major category. Of course, these comparisons are not always apples to apples. Additionally, as mentioned, location makes a big difference in housing costs. A place in Manhattan is a lot more expensive than a place in Queens, and a place across from the Dubai Museum costs a lot more than a place in one of the outlying developments.

The bottom line is that a single person can make ends meet, and have a little left over for saving and/or splurging, on about 127,000 AED a year. Most white-collar professionals and blue-collar managers make a little more than that.

Use Xe to make international money transfers 

Financially, the cost of living in Dubai is lower than in most other large cities in the world. Culturally, there might be a bit of a shock, but it’s usually not too great.

However, if you plan on sending money to friends and family or even your own account back home, you’ll need to add currency conversion costs to your budget. Don’t just count the money you’re actually sending—in addition to upfront currency transfer fees and unfavorable exchange rates, many banks and FinTechs include hidden fees.

If you need a reliable and affordable way to send money overseas to family or friends, log in or sign up to get started with Xe today and enjoy fast, cost-effective money transfers.