Dubai's property market is seeing a dramatic transformation as wealthy investors from all over the world flock to the booming city. Data suggests that their arrival is having an impact on rental costs, fees for private schools, groceries, and transportation. Prices continue to be impacted as crypto millionaires, bankers from Asia, and wealthy Russians seek to shield their assets.

A recent Bloomberg report revealed that a couple were told to leave their rented accommodation after the landlord expressed his intention to move in with his family. However, the same property was later advertised for double the cost the couple had initially paid, $6,000 per month. A lawsuit uncovered a backlog of other tenants facing similar issues due to landlords looking to cash in on higher rental prices.

CBRE Group Inc, a real estate advisor, found that annual rent for a single-family villa rose 26% in 2020 to $80,436 and average apartment rents rose a staggering 28% to almost $27,227. In response, UAE officials have stated, claiming inflation is less severe than London and New York, that the price increases are more modest than seen elsewhere. Metin Mitchell, founder of a C-suite executive recruitment firm based in the region, has commented on the changes taking place saying it “is becoming more of a Monaco, servicing the needs of affluent and high-net-worth people.”

Research has highlighted that consumer prices increased significantly in Dubai with year-on-year inflation rising to a record-breaking 7.1% at one point. However, in February 2020 the rate of inflation began to decline, dropping down to 5%.

The influx of wealthy investors, cryptocurrency millionaires in particular, has changed the landscape of Dubai's economy, with prices increasing across the board as a result. It is an open question as to whether the decline in inflation is just a brief respite from increasing prices or the start of a more permanent shift. However, one thing is certain, any cost of living for those struggling to keep up will only continue to increase as the wealthy continue to benefit.



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