I would agree Harry except I would not include housing since:
-it is a highly risky endevour in Dubai owning property and so it is not for everyone
- while it is a 'choice' to own it skews the perspective of the package and its reality.
-if we are going to include an 'investment' such as a home then we have to include the fact that you have to put 20% of 2 million dhms or more as a downpayment. It is not insignificant since it is a risky asset, we have had one bubble burst and the IMF is warning again of issues. In the end, we should include the opportunity cost lost of what the downpayment could do elsewhere.
-take your 175,000 dhms a year, subtract 35,000 dhms for utilities (and that is conservative), 25,000 plus in fees for the property company, general maintence (I know how often I call maintenance)?????? especially as it ages, municipal fees etc. and you are at 80,000 in direct expenses.
-Then take off the cost of the interest portion which, on average, is around 6% (ridiculous) --2.5 million dhs, assume 0.5 million down, loan of 2 mill, over 10 years (which is VERY conservative since most are 15-20 years) and you interest cost is 90,000 dhms a year (more if you increase the mort length.
-so in the end, if you are lucky, you pocket 15-20,000 dhms a year from the mortgage allowance and rely totally on an increase in value for any true gain.
I'll take my 500,000 dhm downpayment, invest in a broad portfolio, almost completley limits risk and is highly liquid. I would bet that over the 10 years I'll be better off and not have dealt with any of the stress.
I think, for most people, this is the most realistic option.
Yes, I know people who made a ton of money and I know as many who are still in the hole.
But in the end, the the fact is that after expenses you'll be lucky to 'profit' 20,000 dhms from the housing allowance. Not worth it for me.