UAE hosts most affluent households in region

UAE hosts most affluent households in region
Abu Dhabi and Dubai have been ranked 11th and 12th, respectively, in a global list of the highest number of households.

dubai - Abu Dhabi, Dubai lead Middle East in number of households with $250k annual income.



By Waheed Abbas

Published: Thu 8 Mar 2018, 7:23 PM

Last updated: Thu 8 Mar 2018, 10:07 PM

Abu Dhabi and Dubai are home to the highest number of households in the Middle East who earn more than $250,000 (Dh917,500) per annum, says a new survey.

Abu Dhabi and Dubai have been ranked 11th and 12th, respectively, in a global list of the highest number of households earning more than $250K, said a Knight Frank report released on Wednesday.


As per statistics, 270,686 households in Abu Dhabi and 245,272 in Dubai earn more than $250K per annum. Regionally, the cities are followed by Riyadh (198,789) and Jeddah (130,849).

The report forecast growth in the number of such high-income households by 84,067 and 36,432 for Abu Dhabi and Dubai, respectively, during the 2017-22 period. According to Knight Frank, Abu Dhabi will overtake London's 382,807 households that earn above $250k per annum by 2027.

"Economic growth underpinned by the diversification plans in Abu Dhabi and Dubai will mean we are likely to see growth in existing incomes but also the formation of new high-income households as these new high value, knowledge-driven sectors attract new talent to migrate to the two Emirates," said Taimur Khan, senior analyst, Knight Frank.

Globally, North American cities dominate the list as New York tops with 1.167 million households followed by Los Angeles (637,749), Chicago (400,416), San Francisco (396,431) and Washington DC (366,560) among others.

Andrew Amoils, head of research at New World Wealth, recently said the UAE, led by Dubai, attracted more than 5,000 millionaires from India, Turkey, Saudi Arabia and Nigeria during 2017.

Dubai was among the world's top 14 cities - only one from the GCC - where more than 1,000 HNWIs (high net worth individuals) migrated to in 2017.

Vijay Valecha, chief market analyst, Century Financial Brokers, believes that the growth of industries such as engineering, retail, trade, logistics, advertising and media are the major factors driving household income growth.

"One has to bear in mind that there are more working members in every family than what it used to be, which also attributes to higher household incomes," Valecha said, adding that the wage growth rate is expected to be close to 4.5 per cent in the coming year.
"We, however, feel that with the growing knowledge of investments, the household income growth should be 18 to 20 per cent in 2018," Valecha added.

Nirav Shah, director, Fame Advisory, attributes the presence of regional head offices of multinationals in both the emirates for strong household income.
"All trading and service business owners draw handsome compensation due to the absence of personal taxation from their businesses, thus further pushing average household income to be higher, unlike other developed nations. In addition, Dubai and Abu Dhabi are home to lots of high net worth families for various reasons, including geographic location, convenience, safety and taxation perspectives," Shah said.

Overall, while the UAE will continue to be an attractive place for many more such people to relocate, the growth in household income levels will be moderate to slow, he added.

The Knight Frank's Wealth Report also found that Dubai's overnight visitors were the biggest spenders, with a total expenditure of $28.5 billion last year. New York was in second place, with visitors notching up a $17 billion spend. In terms of average overnight visitor spend, Melbourne was on top with an average of $1,925 per person, followed closely by Dubai at $1,917.

Moreover, Dubai also houses the second highest number of 5-star hotels at 61 after London's 75.

- waheedabbas@khaleejtimes.com


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