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Hong Kong economy

Soaring rents make Hong Kong the most expensive city for expats, according to Mercer

PUBLISHED : Tuesday, 26 June, 2018, 9:03am
UPDATED : Tuesday, 26 June, 2018, 11:02pm

Hong Kong regained its dubious status as the most expensive city for expatriates among 209 cities worldwide amid soaring accommodation costs, even as it ranks as a relative bargain when it comes to beer and hamburgers, according to consulting firm Mercer.

Hong Kong edged out Tokyo, Zurich, Singapore, and Seoul among the top five most expensive cities in the world, according to Mercer's 24th annual Cost of Living Survey.

Hong Kong retains world’s top luxury prime housing market tag for second year on Chinese demand

Hong Kong ranked No 2 last year, although it held the No 1 spot in the 2016 rankings.

Mercer’s annual survey rates prices on rental accommodation, meals, and entertainment among a measure of 200 daily necessities in comparing the living cost for expatriates in 375 cities worldwide. The data for this year’s ranking was compiled in March.

Soaring rental costs are the major reason Hong Kong outpaces other cities when it comes to the expatriate lifestyle.

A two-bedroom flat of international standard goes for US$7,671 per month in Hong Kong, compared with US$5,700 in New York and US$5,100 in Luanda.

Hong Kong rents have rallied for 17 straight months, rising 10.6 per cent during the period, according to the city's Rating and Valuation Department. The rental index in April stood at 190.3, up 5.9 per cent year on year.

The city’s coffee is also among the most expensive, costing US$7.74 for a cup, outpacing Luanda at US$3.34, and London at US$3.92, but cheaper than Seoul at US$10.

A litre of milk goes for US$3.78, which is also among the most expensive worldwide, double the price in London, Dubai and Paris, but cheaper than Shanghai.

“The strengthening of the Chinese yuan pushed Chinese cities up in the ranking, however most cities in Japan fell in the ranking due to the weakening of the Japanese yen against the US dollar,” said Slagin Parakatil, principal at Mercer with responsibility for compiling the survey.

Luanda, the capital of Angola, held the top spot in 2017, but slid to the sixth position in this year’s ranking thanks to the weakening of its local currency against the US dollar.

Still, the survey found Hong Kong could also be among the cheapest places for a beer and burger. A bottle of imported 0.33 litre beer sells for US$1.30 in supermarkets, as the city does not tax wine or beer. The same bottle sells for US$2.44 in Singapore, and US$4.18 in Sydney.

A fast food burger meal can be had in Hong Kong for US$4.83, compared with US$6.30 in Tokyo, US$8.19 in Sydney and US$12.87 in Luanda.

Visiting the cinema in Hong Kong is a relative bargain at US$14.71, which is cheaper than US$16.67 in Tokyo, and US$23.48 in London. However a cinema experience only costs US$8.11 in Luanda and US$9.86 in Singapore.

“Asia’s cities, especially Chinese cities, have shown strong performance in terms of cost of living rankings, mainly due to currency fluctuations. Companies are moving top talent around the globe in response to skills shortages,” said Mario Ferraro, Mercer’s global mobility practice leader – Asia, Middle East, Africa and Turkey.

Peter Chan, career consultant at Mercer Hong Kong, said the high cost of living does not necessarily discourage expatriates from coming.

“The cost of living is only one of the many factors that global talents consider when they decide working location. They also look at how safe the city is, quality of living and career opportunities,” Chan said.

 

 

 

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