British expats are being priced out of Dubai as property is snapped up by wealthy Russians following the Ukraine invasion. Since 2022, Russian nationals have spent $6.3 billion (£4.8 billion) on existing and in-development properties, according to economists from the EU Tax Observatory and Norway’s Centre for Tax Research. Last month, property firm Knight Frank revealed that prices in Dubai have risen 124 percent since 2020. This surge is forcing British expatriates to look elsewhere, according to a real estate expert in the region.
Many British expats now commute to work in Dubai from neighboring areas like Ras Al Khaimah, which is an hour to 90 minutes away by car. Mona Jalota, founder of Krypton Global Real Estate, said she had seen an increase in enquiries from British expatriates looking to move out of the city for more affordable rents and purchases. “Every time there is a global or political crisis, Dubai continues to be a safe place to invest, and this continuous demand pushes prices up,” she explained.
Shruti Krishnan from White Window Real Estate said Russian buyers are influencing landlords to prefer cash-only sales. “Most of the Russian market is buying in areas with high rental yields, like Downtown Dubai and Creek Harbour, where short-term rentals are highly profitable. Cash purchases make the sales process faster, encouraging more sellers to ask for cash-only deals, especially since the war began,” she noted. This has created a two-tier pricing system in the market, with cash sales of one million Emirati Dirhams (AED) equating to around AED1.25 million to mortgage clients.
Rising rents are also pushing more people in Dubai to buy homes as rent levels approach mortgage costs. For example, a one-bedroom apartment in Dubai South, rented for AED35,000 a year last year, now costs AED50,000 annually. The price surge coincides with a significant spike in interest from British nationals looking to move to the UAE from the UK. John Mason International Movers reported a 50 percent increase in enquiries this year from people aiming to leave the UK.
Steve Johnston, a Brit who recently left Dubai after living there for 27 years, moved to Ras Al Khaimah, where he now pays 40 percent less in rent. He was paying around AED4,000 (£830) a month for a studio apartment in Dubai, but now pays just AED2,300 (£480) for a new building that includes free air conditioning, internet, and electricity. “I can see a lot more people moving out of Dubai,” he said.
Jennifer Webster is also relocating due to high rental costs. “I’ve been served my second eviction notice in three years as landlords try to capitalize on higher rental rates for villas. It’s too costly to keep moving, and finding another villa for myself, my husband, and our two rescue dogs is unaffordable,” she lamented. Despite moving further out of the city, costs remain high, forcing her family to live hand-to-mouth.
The EU Tax Observatory's report highlighted a substantial boom in Russian interest following the war outbreak. “We estimate that Russians bought $2.4 billion worth of existing residential real estate in the two years after the invasion, and another $3.9 billion in off-plan properties. This represents roughly a 940 percent and 1,500 percent increase over the previous two years,” the report stated.
