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Dubai Settling Surprises |
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9/30/2006 8:31:33 AM |
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When people are trying to make a decision concerning accepting a job offer and relocating here, they usually try to work out how far a proposed remuneration package is sufficient to cover expenses.
In most cases, they are able to get a good idea of the breakdown of potential expenses in terms of accommodation, transportation and school fees even before they land here. Accordingly, they calculate their potential savings and decide whether an offer is satisfactory or not.
In addition to the margin of error in those calculations, people usually fail to take into account Dubai's mass of small fees for both government and private services, which can add up to an unpleasant surprise for newcomers with tight budgets.
Fees are a reality of living in Dubai similar to high rents and traffic jams. Government fees are sometimes regarded as a replacement for taxes.
If you are a newcomer, expect the first few months to be the worst, since you'll have to pay a lot of unexpected fees all at once.
The first to come your way will be during the hunt for good accommodation within your carefully-planned budget. For example, if you decide to go for a maximum Dh70,000 annual rent, you'll easily find some good options. But once you've committed yourself to this rent, you will find that you have to pay a commission to the real estate agent (from three per cent to five per cent) and a refundable deposit to the landlord (another five per cent). Your annual cost has just grown to Dh75,600.
Additionally, there is the Dubai Municipality's housing fee (five per cent of the annual rent), which was introduced in January 2005. You do not have to pay it all at once, but along with your Dubai Electricity and Water Authority (Dewa) monthly bill. It is meant to be for maintenance of public facilities, trash collection, etc.
There have been many complaints that the services provided do not match the amounts of money collected, especially for those who have arrived in the last year and been burdened with excessively high rents. With this additional fee, your annual cost has just grown Dh3,500 to Dh79,100.
It is also worth noting that Dewa charges a Dh1,000 deposit paid in advance making the cost Dh80,100. Even though deposits are all refundable, you will need to come up with more than Dh10,000 in fees and deposits above your original budget.
Then comes the next hurdle, which is driving in Dubai. Those with driving licences from the GCC, the US and many European countries can swap their licences for UAE ones for Dh110. But if you are one of us coming from the Middle East, Asia or Eastern Europe, you will have to go through extensive testing.
The process can be pretty lengthy for beginners who do not carry valid licences. But even for experienced drivers, it can cost up to Dh1,000 to take the compulsory tests and classes. Multiply this with the number of family members who are potential drivers in Dubai.
Your view of the cost may go back to where you are coming from. If you are coming from a country where government services are subsidised and cheap skilled labour is plentiful, you will feel the sting of settling here.
It may help if your employer is providing any sort of relocation assistance, but still you should bear in mind that fees are a signal of Dubai's expensive living standards. Therefore, if your move is financially-driven, you need to plan to minimise such black holes in your budget and be prepared for unexpected fees. |
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