Saudi Arabia Country Profile - Cost of Living

     
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Geographical variation

Typically the cost of living in Saudi Arabia is more expensive in the cities and suburbs. Although the country is reputed to have a low cost of living, prices for most goods are not really as low as they seem (with fuel being the notable exception). While locally-sourced produce is cheap, imported goods can be quite expensive. However, with low taxes, less entertainment facilities to spend money on and employers often subsidising housing or living costs, foreign nationals typically find their spending power goes up considerably compared to home.

Accommodation

The majority of foreigners in Saudi Arabia live in expat compounds, but this is not compulsory. Although foreign nationals are no longer banned from buying property in Saudi Arabia, it is not common practice as various permits are required and renting is usually a more cost-efficient option. Because most foreign workers are sponsored by their employer, many companies will arrange accommodation as part of the employment package, at least on a short-term basis. If not, a relocation allowance or the services of a relocation consultant may be offered instead. The transient nature of the expat population means some landlords will only deal with a local contact, so speak to your sponsor before searching for your own accommodation.

Rental deposit

A deposit of one month’s rent is usually requested as security in addition to the first monthly payment. However, some landlords will ask for advance payment of six months’ or even a year’s rent. In these situations, employers will normally cover the cost and enable you to pay monthly rent back to them.

Property tax

In some regions there is a local tax imposed on property. The baladiya covers the cost of local services like road maintenance and refuse collection. Some landlords include it in the rent while others leave it to the tenant, so make sure you ask ahead of signing a contract.

Utilities

In Saudi Arabia, utility costs are subsidised by the regional authorities through state-owned suppliers. Water is provided through the National Water Company and electricity through the Saudi Electricity Company. There is no mains gas supply, but bottled gas can be purchased fairly cheaply. Watch the electricity bill in summer though – air-conditioning costs can really add to your expenditure. The telephone, mobile phone, internet and TV service markets are more competitive, with state provider Saudi Telecom Company aiming to keep prices low and encourage investment.

TV licence

Saudi Arabia does not have a TV licensing system, but the state broadcaster only runs one English-language channel. However, paid and free-to-air services are available through companies like Nilesat and Arabsat, offering a greater choice of language services for expats.

Healthcare and medical costs

A good standard of healthcare is provided to Saudi citizens free of charge by the Ministry of Health. While expats are allowed to access the same healthcare facilities, they must pay for treatment which can be very expensive. As a result it is now compulsory for foreign nationals living in Saudi Arabia to have health insurance, but many employers will provide this as part of their proposition.

Shopping

Shopping choice is extensive in Saudi Arabia, with everything from the bargains of local souqs to practical supermarkets and high-end designer stores. Grocery shopping can be fairly cheap, as can white goods which have fairly low import duties. However, clothing can be expensive, and while they have a great choice, the top malls are not the place to go if you are looking for value for money.

VAT

In line with its low-tax policies, Saudi Arabia does not charge value-added tax (VAT) on goods and services.

Price guide

  • Rent on 1-bedroom apartment in city centre – SAR1,536.92 (≈£261.47) per month
  • Rent on 1-bedroom apartment outside city centre – SAR1,141.24 (≈£194.16) per month
  • Price of apartment in city centre – SAR4,700.00 (≈£799.60) per square metre
  • Price of apartment outside city centre – SAR3,608.33 (≈£613.88) per square metre
  • Loaf of bread – SAR2.34 (≈£0.40)
  • Milk (1 litre) – SAR4.05 (≈£0.69)
  • Bottled water (1.5 litre) – SAR2.02 (≈£0.34)
  • Draught beer (0.5 litre) – SAR3.00 (≈£0.51)
  • Packet of cigarettes – SAR9.50 (≈£1.62)
  • Petrol (1 litre) – SAR0.51 (≈£0.09)
  • Cinema ticket – SAR100.00 (≈£17.01)

Source: www.numbeo.com (accessed November 2014)

 

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