Is Dubai's Cost of Living Getting Too High? An Honest Look at Rising Expenses and Expat Struggles

The question isn't whether Dubai's cost of living is rising—it's whether residents can afford to stay. With rental prices climbing double digits annually, stagnant salaries, and essential goods becoming increasingly unaffordable, the emirate's reputation as a tax-free paradise is beginning to feel like a mirage for middle-income expats and working families.

The Housing Crisis No One's Talking About

Let's address the elephant in the room: housing. Dubai's rental market has transformed into a beast of its own, with apartment rents surging by 28% annually while villa rents in premium areas reach approximately 295,436 AED per year. According to recent predictions, 2025 will see rental increases ranging from 10-13% for long-term leases, with luxury segments climbing as high as 15-18%. For short-term rentals, some analysts forecast an 18% jump.​

A one-bedroom apartment in the city center now averages between 70,000 to 110,000 AED annually—roughly 5,500 AED monthly. Compare that to what Reddit users are experiencing: one individual noted that a basic one-bedroom in Sharjah requires 26,000 AED monthly, forcing residents to choose between comfort and financial security.​

The real crisis? 56% of expat households are now paying unaffordable rents, spending more than 41% of their income on housing. As one Reddit commenter bluntly put it: "Everything except for the paycheck" is increasing.​

Salaries Stuck in Neutral While Costs Sprint Ahead

Here's where frustration turns to desperation. While Dubai's cost of living exploded, salaries have remained virtually unchanged. Cooper Fitch's 2025 UAE Salary Guide predicts zero salary growthacross the UAE, maintaining an average growth rate of 0% despite inflation running at 7% annually.​

Expats report minimal increases—if any. One professional shared that their last raise was a mere 100 AED monthly, a pittance compared to rent hikes of 5,000+ AED. Meanwhile, landlords can legally increase rent by up to 20% every three years, creating a lopsided equation where living costs far outpace income growth.​

A Reddit user summed up the frustration: "Been working for 7 years in Dubai but not a single dirham is in my savings".​

The Hidden Costs Nobody Mentions

Beyond rent, Dubai has developed an ecosystem of escalating expenses that few anticipate:

Groceries and Dining: Imported food inflation hit 15% in 2024. Staple items have nearly doubled—Indomie noodles jumped from 2.5 AED to 5 AED, while Pizza Hut's limo pizza climbed from 69 AED to 109 AED since 2018. Restaurant meals at upscale establishments now start at 180 AED, compared to 50-60 AED just years ago.​

Education: Private school fees average 120,000 AED annually—triple the UAE median salary. As one parent noted, this has forced 35% of families to send their children back home for schooling.​

Transportation: Uber fares during peak hours rival New York taxis, while the expanding Salik toll system adds 200-400 AED monthly for cross-city commuters. Transportation costs rose 18% in 2024 alone.​

Healthcare: Premium health insurance plans now cost 12,000-18,000 AED annually per family, with public clinics facing 4-hour wait times for non-Emiratis.​

What Locals Are Saying on Social Media

The sentiment on Reddit and social platforms tells the true story:

"Rent, groceries, schooling, and now even eating out, everything seems to be getting more expensive. For those who have been here for a while, do you believe that Dubai remains affordable compared to how it was 5-10 years ago?" — Reddit user discussing whether Dubai is affordable​

Another commenter listed the cumulative burden: "The removal of the oil subsidy, previously free delivery services, the introduction of 5% VAT, rising healthcare costs, increasing rents, more Salik gates and peak hour pricing, higher parking fees, escalating school tuition fees, increased government fees across the board"​

The consensus is clear: while Dubai hasn't introduced formal income taxes, residents are effectively paying taxes through inflated living costs, with everything from plastic bags to driving licenses now carrying fees that didn't exist before.​

The Middle-Class Squeeze

What's particularly concerning is who bears the brunt of this crisis. While high-earning professionals and business owners can absorb cost increases, middle-income workers—earning 15,000-30,000 AED monthly—face displacement. Low-paid migrant workers earning just 300-550 AED monthly are forced into overcrowded housing situations.​

Dubai's housing crisis reflects a structural problem: only 20% of available properties are affordable, despite 40% of demand coming from the affordable housing segment. The city's homeownership rate remains just 30%, one of the lowest globally.​

Is Leaving Becoming the Easier Option?

As one Redditor observed: "Leaving has become an easier decision every year I stay here"​

This sentiment is spreading. With salaries stagnant and costs climbing, expats are increasingly considering relocation to other Gulf markets like Saudi Arabia, where salaries are reportedly more competitive. The irony is painful: Dubai built its reputation on attracting global talent, yet that same talent is now being priced out.

Dubai's cost of living isn't just high—it's becoming structurally unsustainable for the average expat. The tax-free income that once compensated for expensive living is now insufficient to cover spiraling housing costs, inflation-driven groceries, and mounting hidden fees. Unless the city implements meaningful reforms—such as rent controls that actually work, wage growth policies, and affordable housing initiatives—the demographic that built Dubai's service economy may find themselves unable to afford calling it home.

The question isn't whether Dubai is expensive. It's whether it's still worth it.