Top 20 Most Expensive Cities in the World

The cost of living in any given country gives one sense of what it may be like to live there. Obviously big cities tend to be the most expensive, which is why Japan’s three biggest cities rank within the top 10 among expensive countries for expatriates – they’re huge. And all of the little things – like food and transportation – add up. New rankings were released on the cost of living among 214 cities; so check below to find out if your city made the list.

Cost of Living Survey

The ranking below indicates the most expensive places to live for expatriates. From the Mercer.com website, who say this about their ranking criteria:

Mercer’s Cost of Living rankings are released annually and measure the comparative cost of living for expatriates in 214 major cities. We compare the cost of over 200 items in each location, including housing, transport, food, clothing, household goods and entertainment. We use New York City as the base city for the rankings and the US dollar as the base currency.

Two main factors determine a city’s position in Mercer’s Cost of Living rankings:

  1. the relative strength of the relevant currency against the US dollar in the 12 months between ranking (March 2011 to March 2012 in this case); and
  2. price movements over the 12 month-period compared to those in New York City as the base.

Ranking

Last year’s rankings are in brackets below.

  1. Tokyo, Japan (2)
  2. Luanda, Angola (1)
  3. Osaka, Japan (6)
  4. Moscow, Russia (4)
  5. Geneva, Switzerland (5)
  6. Zurich, Switzerland (6) (Tied with Singapore at #6)
  7. Singapore, Singapore (7) (Tied with Zurich at #6)
  8. N’djamena, Chad (3)
  9. Honk Kong, Hong Kong (9)
  10. Nagoya, Japan (11)
  11. Sydney, Australia (14)
  12. Sao Paula, Brazil (10)
  13. Rio De Janeiro, Brazil (12)
  14. Bern, Switzerland (16)
  15. Melbourne, Australia (21)
  16. Shanghai, China (21)
  17. Beijing, China (20)
  18. Oslo, Norway (15)
  19. Perth, Australia (30)
  20. Libreville, Gabon (12)

The most expensive city in Korea is Seoul, ranking in at 22. London was the most costly in the UK. Other European cities included in the rankings were Paris at 37, Milan at 38, Rome at 42, Stockholm at 46, Vienna at 48, Amsterdam at 57, and Dublin at 72.

America’s most expensive cities are New York at 33, Los Angeles at 68, and then San Francisco at 90. Canada ranks in with Toronto at 61, Vancouver at 63, and Montreal at 87.

Is Tokyo Really That Expensive?

Yes. Yes it is.

It’s not that every single exchange of money is absurdly expensive – of course not. There are many people who successfully live cheaply – for example, by cooking your meals at home instead of going out to eat – but it’s easy to fall in the trap of saving time by spending money. That’s because places like Tokyo are good at making things convenient… if you’ve got the money for it. For example, some people – not expatriates, but even Japanese people – essentially never make their own food, instead opting to buy ready-made food at the seriously convenient convenience stores. All though, yes, there are indeed certain things that are – compared to other countries – astronomically more expensive.

For example, fruits and vegetables in Japan are not only generally smaller, but far more expensive. It’s common to see fruits sold individually, such as single kiwis, apples, bananas, etc. To the right, you can see a picture I took last week of a watermelon at a standard price, 1980 yen (it’s not hard to see a price tag around 2500 for watermelons). Converted, 1980 yen is about $25, or £16. How many watermelons could you buy in your country with that? (Full disclosure: Shockingly, I spotted a good-sized watermelon for only 580 yen today, which is by far the cheapest I have ever seen in Japan. I naturally had to buy it.)

From the Wall Street Journal:

According to data from the Bank of Japan, the average dollar rate for the survey’s most recent period through February 2012 was ¥78.9, an 8.6% decline from the previous year.

Japan hasn’t been a cheap place to live for a long, long time. This was the 12th year Mercer ranked Tokyo most expensive city since 1994, including four years running through 1997, when the dollar averaged ¥122.9. Even when it hasn’t been No. 1, Tokyo has ranked among the top three every year except 2007, when it dipped to fourth.

[. . .] According to Mercer, you can buy two cups of coffee in New York for what it costs to buy one in Tokyo — $8.29. That is more than any other major Asian city ranked in the top 10. Tokyo is also the most expensive place to watch a movie. Admission is an average of $22.97, about $3 more than in Sydney, the next most costly city to catch a film.

[. . .] Yet Tokyo real estate is a steal compared with Hong Kong and Luanda, where the monthly rents for a luxury two-bedroom unfurnished apartment are $7,092 and $6,500, respectively. Still, Tokyo’s average monthly rent — $4,847 — is the third-highest, even as rental prices have fallen “as people relocated from the affected area to the south of Japan” following last year’s earthquake and tsunami disasters.

Whereas Tokyo became the most expensive city for the 12th year since this survey began, Karachi, Pakistan, is the least expensive country in the rankings this year. Living in Karachi cost less than a third the price of living in Tokyo. But here’s the real news: It looks like Tokyo is going to be #1 for quite some time, now that Japan’s lower house parliament decided to double the consumption tax a few months ago from 5% to 10%.

So if you’re feeling particularly small in the big city this year, just remember that you’re not the only one. Now stop taking it for granted and go buy yourself a big, juicy watermelon.

“A rich man is nothing but a poor man with money.” -W. C. Fields

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2 Responses to Top 20 Most Expensive Cities in the World

  1. Pingback: Top 20 Most Expensive Cities in the World | Skeptikai | The Best Cities In The USA

  2. eparanor says:

    really ironical to put angola at the second spot when 60percent of the population are living in poverty.

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