Dubai: The British pound’s fresh slump last week does not seem to have worried Brits who live in the UAE.
Amid new jitters back home over a ‘hard Brexit’, — a looming, bitter divorce from Brussels so feared by banks and Europhiles — and a mysterious ‘flash crash’ drop on Thursday night from Asian trading floors, the pound sits at a three-decade low against the dollar.
Yet for many British expats, who get paid their salary in the dollar-pegged dirham, there’s little cause for worry.
“Personally, it doesn’t really affect me, because I don’t have any kind of major investments in the UK,” said Thomas Basha, a British expat who lives in Dubai.
Like many Brits, Basha keeps a close eye on events back home — and he won’t be snapping up bargain-rate pounds just yet.
“I think the pound’s going to fall still. I’d expect it to fall further because we’re still in that period of uncertainty.”
Aftershocks from the Brexit vote back in June, when British voters opted to leave the European Union, are still being felt, as governments and banks across the bloc struggle to guess the terms of the upcoming split.
Expats who juggle busy careers in the UAE and families back home have mixed feelings on the pound’s weakness.
“The value of the pound has affected me both positively and negatively,” said Natasha Baker, a British expat who regularly flies home to see her parents. “My future trips to the UK will be more luxurious.”
And while her savings — held in a British bank — have been given a boost, family members who often visit her in Dubai may now stay home.
“For my family who are paid in pounds, the likelihood of them coming to visit me in Dubai is much lower. Ultimately, this will affect how much I spend as I will need to go home more frequently,” she added.
Fatter wallets
One British expat who left the UK in July, weeks after the Brexit vote, said that at first, the weak pound was “kind of disappointing”.
“I was getting a little bit less dirham for my pound every time I withdrew money from my UK account or exchanged currencies at an exchange shop,” said Mitch, who gave only his first name.
After setting up local bank accounts for his salary in Dubai, there’s little more to care about — except the prospect of a fatter wallet when back home on holiday.
But for overseas British property investors, many of whom are drawn to Dubai’s warm climate and high-end lifestyle, the plummeting pound is bad news.
The June referendum that saw Britain vote to leave the EU, has had a “huge knock-on effect” in the sector, according to a British expat who works for a Dubai-based real estate broker.
“Due to the current crisis, sterling-based buyers have been almost wiped out locally,” said Andrew Cleator, the sales director for Luxhabitat.
This is significant due to Dubai Land Department statistics, he added, that “prove year after year that Brits represent the third largest group of expat real estate buyers in terms of nationality and volume”.
However, expats eyeing their own personal Brexit from Dubai’s property market may find that the currency cloud has a silver lining.
“Brits looking to sell can seriously look at reducing their prices if repatriating their dirhams,” said Cleator.
