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The United Arab Emirates (UAE) has been a leading emerging market location for several years and was ranked No. 2 in the top emerging markets generating employee interest in Cartus’ 2013 Talent Management Survey. Yet it remains a challenging destination with issues such as cultural differences and for some, acclimatizing to the weather.
Housing and Rentals
There are various types of accommodation in the UAE including hotels, serviced apartments, standard apartments and villas, each with a selection of furnished or unfurnished properties. However, some property types can be fairly low in availability, with three and four bedroom properties the most difficult to find. This can sometimes come as a surprise to assignees as the international press often present the UAE, and Dubai especially, as a relatively easy place to source accommodation. With this in mind, it is important to set assignees’ expectations prior to arrival.
One of the biggest challenges in the housing market can be landlord cooperation. There have been reports of landlords trying to avoid maintenance expenses, leaving the tenant to carry the cost themselves. To combat this, we work with reputable real estate agents, who each have good, lasting relationships with their landlords. Should a landlord be unknown or new to the market, the real estate agent will meet with them and in many cases, request them to sign an agreement to commit to cooperation and professionalism during the lease. Agreement commitments include, meeting maintenance requirements and returning security deposits. We also advise assignees not to source properties on their own, as we cannot ensure the property’s landlord will have had a background check.
Rental prices in both Abu Dhabi and Dubai are rising, due to high demand. Previously in Abu Dhabi there was a rental cap law that limited landlords to annual rental increases of five percent. This cap has now been lifted, allowing property owners to increase rental rates without limitations.
Demand in Dubai’s rental and sales markets is expected to continue to rise as it has been chosen to host the World Expo trade convention in 2020. Dubai will be the first Middle Eastern city to hold the Expo, which takes place every five years and sees countries demonstrate the latest developments in technology and architecture.
It is standard practice to pay annual rent before the start of the lease in UAE. Given that lease start dates are typically only seven to 10 days after an assignee has viewed a property, we recommend that you ensure security deposits and annual rental payments are available within five days after the property has been reserved. This prevents any delays in securing a lease for a property.
We encourage our clients not to offer assignees a lump sum allowance for housing. In our experience, some assignees who receive a lump sum try to make cost savings on the property and neighborhood they move to, so that they can keep the rest of the payment. In the UAE, this often means that the assignee ends up regretting their accommodation choice and in some cases, may have to move again.
There are various education systems available to cater to the needs of assignees in the UAE, including French, British, American, Indian, German and Australian.
Since most assignees send their children to private schools, the fees can be quite high and the most popular schools and nurseries have waiting lists. This means that in some cases, the assignee may not get their first choice or they may not have all siblings attending the same school. With this in mind, it is important that the assignee is flexible in their school choice and they should be advised of this prior to arrival.
We recommend that you reflect the high cost of school fees in your school allowance budget. School applications include a nonrefundable fee of around U.S. $135 to U.S. $280 each. Bearing in mind that an assignee will typically submit between four and five school applications per child, we advise that you provide or contribute to school application fees as part of your mobility program.
Given the long waiting lists for good quality schools, assignees should visit UAE school websites and join online waiting lists before they arrive in the country.
The UAE is a Muslim country, regulated by the Sharia or Muslim Law, which can be considered as fairly conservative. However, on first arriving, assignees may perceive the country to be quite cosmopolitan and liberal, either unaware of the country’s religious laws or overlooking them.
Examples of Sharia Law include:
The prevention of same-sex couples living together can be problematic should two female or male assignees want to share a property to save money on rent as they could, potentially, get into trouble with authorities. With this in mind, it is imperative that assignees and their families are aware of the local laws and customs and be respectful of them.
There can also be challenges for assignees who wish to obtain a liquor license, which is required before they can purchase alcohol in the country or drink in their home. The license application requires a letter from the assignee’s company. Licenses only permit the holder to purchase alcohol in the Emirate that issued the license, so a permit issued in Abu Dhabi will not be valid in Dubai. In addition, should an assignee have a Muslim name or a Muslim-sounding name, it can be very difficult to obtain a liquor license in the UAE.
Some flexibility can be given to expatriates who do not abide by these regulations, but we strongly advise all assignees to follow Sharia Law while in the UAE as matters can escalate quite quickly if they are caught not doing so.
We recommend cross-cultural training for assignees moving to the UAE. The training you choose should take the length of the assignment into account as well as the scope of relocation experience that the assignee and their family has.
As the UAE is a Muslim country influenced by religion, utmost respect should be given to local religious sensitivities at all times. Disregarding these may have a detrimental effect on business relationships.
Some cultural issues that could impact companies and assignees include:
It is important to note that a large portion of the UAE population are expatriates, so it may be more than likely that assignees will conduct business with a Westerner.
The summer months can come as a surprise to some assignees on their first visit to the UAE. Temperatures can be as high as 118F with humidity reaching between 85 percent and 95 percent although air conditioning is used widely in housing, offices and cars.
It can be quite uncomfortable being outside in the heat of the day during the summer months, especially when trying to complete tasks such as finding a property. With this in mind, we recommend that you consider scheduling any first visits or permanent moves outside the hottest months.
The UAE immigration process is not overly complex, but it can be lengthy and requires many documents from the assignee’s home country such as a legalized marriage certificate for the spouse and legalized birth certificates for children. The intricacies of the process also depend on what country the assignee originates from. Settling-in processes such as purchasing a car, opening a bank account and applying for a driver’s license cannot begin until a residence visa has been obtained. All UAE residents are required to obtain an Emirates identity card to ensure immigration status. Failure to obtain an ID card may incur daily fines. Obtaining the ID card has been consolidated into the residence permit process.
Due to the time implications involved in the immigration process, we recommend that assignees begin the work and residence permit process as early as possible. It is always advisable to ensure that they gather the required personal documentation (birth and marriage certificates) and have them legalized by the UAE Mission or consulate in the country of issue of the document. The better prepared they are means the faster and smoother the process will be.
To assist your assignees, you can—upon their arrival—certify to authorities that their visa is in process and also provide them with a letter of employment. This will allow them to rent a property.
Abu Dhabi is located on the central western coast. It is:
Dubai is located on the northern coast. It is:
Pat DeDonato is senior vice president of supply chain management at Cartus, a provider of global relocation solutions serving half of the Fortune 50, in more than 165 countries, helping clients with their mobility, outsourcing, consulting, and language and intercultural training needs.
Copyright 2014 © Cartus. All rights reserved.
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