CUT­TING BACK AS COSTS GO UP

Res­i­dents look­ing to re­duce ex­pen­di­ture

7 Days in Dubai - - FRONT PAGE - By Shoshana Ke­dem and Ma­hak Man­nan @7DAYSUAE shoshana@7days.ae

Nearly two-thirds of people in a 7DAYS poll said they were con­sid­er­ing some form of down­siz­ing due to the ris­ing cost of liv­ing in the UAE.

The poll was car­ried out af­ter fig­ures showed a rise in es­sen­tial ex­pen­di­tures such as food and ed­u­ca­tion in the first quar­ter of 2016.

We asked read­ers if they were plan­ning to down­size and, if so, how. More than 700 people re­sponded to the poll, with one in six say­ing they were go­ing to down­size from a villa to an apart­ment.

Although one third of people said they had no plans to down­size, five per cent of re­spon­dents said they were go­ing to change their chil­dren’s school while 15 per cent said they were mov­ing to a cheaper part of their city. Nearly 30 per cent of people said they were con­sid­er­ing mov­ing to an­other emi­rate.

As part of the sur­vey, 7DAYS also spoke to a num­ber of fam­i­lies, who were can­did about their strug­gle with ris­ing costs.

One ex­pat in Dubai, Kanika Sood, said: “Every­thing here is get­ting more ex­pen­sive, and salaries don’t rise in pro­por­tion to in­fla­tion, so that puts a lot of pres­sure on my hus­band.”

Sood (pic­tured right with her hus­band, sixyear-old son and 21-month-old twins) added: “I came here 15 years ago and I’ve seen the value of money go down. It’s amaz­ing to see how prices have risen.

“Dhs500 used to go a long way, now it doesn’t even get you through the week.”

Sood said many of her friends who came to Dubai to save have re­turned to their home coun­tries be­cause they can no longer put any money away.

“A lot of our friends have ac­tu­ally re­turned to their home coun­tries be­cause they sim­ply can’t cope with the kind of in­fla­tion you’re see­ing now and they’re not able to save,” she said. “When you have rents and gro­cery bills in­creas­ing it all adds up at the end of the month.

“They can prob­a­bly save about five per cent of their salaries but that’s not re­ally enough. “People come here to save but if you’re not sav­ing then what’s the point.”

Ac­cord­ing to the Dubai Sta­tis­tics Cen­tre, the in­fla­tion rate in Dubai was 1.61 per cent in the first quar­ter of 2016.

How­ever, hous­ing and util­ity costs, which make up 43.7 per cent of con­sumer ex­penses, rose 4.15 per cent dur­ing the pe­riod com­pared with the first quar­ter of 2015, while the price of food and bev­er­ages went up by 2.96 per cent.

The cost of ed­u­ca­tion climbed 4.83 per cent in Dubai in the first three months of 2016, com­pared with the same pe­riod in 2015.

Mean­while, in Abu Dhabi, the cost of liv­ing rose by 3.2 per cent in the first three months of this year when com­pared to the same pe­riod in 2015.

Sta­tis­tics Cen­tre - Abu Dhabi said hous­ing, wa­ter, elec­tric­ity, gas and other fu­els ac­counted for the largest rise in the Con­sumer Price In­dex, go­ing up 7.7 per cent

In­dian ex­pat Ab­dul Haq, 38, who works in sales in Abu Dhabi, be­lieves there is lit­tle chance of mak­ing sav­ings if your com­pany does not pay for hous­ing and ed­u­ca­tion, since those are the high­est out­go­ings.

“I earn Dhs12,000 per month and have two kids,” he said.

“The most ex­pen­sive thing here in Abu Dhabi is rent and ed­u­ca­tion both of which are sky high for no rea­son what­so­ever.

“I cur­rently pay ap­prox­i­mately Dhs40,000 per year for my kid’s school­ing, the younger one is two years and hasn’t started school yet.

“Rent is 80,000 per an­num. Imag­ine when I need to pay for both the kids in a year or two, how will I man­age?

“It is like a hand to mouth sit­u­a­tion. What­ever comes in the bank is im­me­di­ately out with all the ba­sic ex­penses that have to be taken into ac­count.”

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