While Dubai continues to pump out sumptuous new apartment blocks, for a rising number of expatriates the city no longer offers the luxury lifestyle that lured many foreigners to the Gulf. A shortage of affordable homes and a reduction in overseas allowances since the financial crisis are pushing foreign staff on middle incomes out to less glamorous areas of the city far from the office, or to neighbouring Sharjah. Investment bankers, lawyers and top managers at multinationals may enjoy seven-figure salaries but other expatriates - from architects, accountants and information technology managers to legal secretaries and HR executives - are often on household incomes of 10,000 to 30,000 UAE dirhams a month, says property consultants JLL. They can afford annual rents of 72,000 dirhams, says JLL, or could buy a property for around 790,000 dirhams - a fraction of prices in expatriate neighbourhoods Dubai Marina and Dubai Downtown, for example, where two-bedroom apartments sell for up to 4 million dirhams. "There's a squeeze on middle-income earners," said Faisal Durrani, head of research at property consultancy Cluttons. "Affordability issues are likely to become more acute." The emirate's real estate sector has been among the most volatile globally over the past decade as it turned from boom to bust to boom again. Property prices, and rents, have steadied in the past year but are still 50 per cent higher than two years ago, according to estate agent Cluttons, and are expected to be on the rise again by 2017 as Dubai prepares to host the Expo 2020. The only districts offering affordable accommodation for many middle-income earners are run-down areas near Dubai's creek and parts of the city's outskirts, such as International City and Dubai Outsource Zone. But as expats move out of more central areas, previously cheaper suburbs have experienced the biggest rental increases. Randy, a Filipino fitness instructor, and his British wife Layla moved to Remraam - one such area, about 50km from Dubai's business district - in May 2013. "We used to live in Business Bay, which was only a 10-minute drive from most of my clients," said Randy, 37. "We rented a one-bedroom apartment, but it got so expensive we moved here - it was the only nice place we found where we could afford a two-bedroom place. We're now 30 minutes' drive from anything." The couple initially paid 55,000 dirhams in annual rent, but this has risen to 63,000 dirhams, limited by rent caps. But caps only apply if a tenant renews a lease and two-bedroom apartments in Remraam now advertise for 80,000 to 100,000 dirhams a year. Land is traded like a commodity in Dubai, inflating prices. This has pushed developers to focus on high-margin luxury projects - middle-range apartment blocks are difficult to make a profit on without subsidised land. This year developers have launched new projects totalling 19,500 homes, of which JLL estimates only 22 per cent would meet its definition of affordable for the middle-income bracket. About 70,000 new homes in total are due to be completed in Dubai by the end of 2018, more than double the number in 2013-2014, but below a 2007-2008 peak of 90,000, CBRE estimates. "These units are not being completed at such a quick rate so we see a major negative impact on the rental market," said Mat Green, research head at CBRE Middle East. Many employers in the emirate have done away with housing allowances and slashed overall remuneration in the wake of the 2007-2008 financial crisis but may have to re-evaluate those packages if they want to retain the same calibre of talent. "The need for affordable housing will become more pronounced," said Dana Salbak, JLL research manager. "Employers will have to increase wages or housing allowances to attract and retain staff." Some residents have moved to conservative neighbour Sharjah. Property prices are less than half those in Dubai, Cluttons estimates, and late last year Sharjah allowed foreign UAE residents to buy property in some developments. However, it is more than an hour's drive away in rush hour from Dubai and lacks the dining, shopping and nightlife that its neighbour offers. Green says Dubai should prioritise build-to-lease projects whereby the emirate's developers, the largest of which are state-owned, retain ownership and lease units out to tenants to keep rents at affordable rates. "But developers are commercial entities with responsibilities to their shareholders to deliver profit and dividends," he said, and thus so far have not favoured such schemes. Owning a home has become further out of reach for long-term expats like Randy since the United Arab Emirates, aiming to deter speculative buyers, has raised the minimum mortgage deposit to 25 per cent over the past two years. Dubai has also doubled property sales transaction fees to 4 per cent. "If I want to buy a 1 million dirham property, I need to find about 300,000 dirhams up front," said Randy. "Where am I going to get that?"