If you’re familiar with the chaos surrounding the move to a big city or you’re currently looking to make the change, you probably already know that it also comes with a hefty price tag. Large cities with dense populations are notorious for their high cost of living. From real estate and land to everyday commodities, everything is more expensive in a bigger city, especially if the demand for housing is high — unfortunately for many, the cost keeps rising if people are willing to pay.
For those who want to know which cities have their citizens breaking the bank, you’re in luck. Each year, the Economist Intelligence Unit releases their Worldwide Cost of Living list that provides an in-depth, detailed look at the breakdown of costs associated with living in the ten most expensive cities in the world. While you might expect to find some of these international attractions on the list, you may be surprised to see which city ultimately takes the number one spot.
10 most expensive cities in the world
10. Los Angeles, U.S.
Known as the “City of Angels”, Los Angeles is the most populated city in sunny California and second only to New York City in the United States. Situated on the west coast, California’s warm climate and close proximity to the Pacific Ocean makes it one of the most popular tourist destinations in the world and Los Angeles is its crown jewel. As the epicenter of the entertainment industry, the city is a magnet for aspiring actors and actresses looking to make their big break in Hollywood. Home to over 4 million people in the metropolitan city alone, however, means that it’s no cheap rent.
Los Angeles’ booming tourism industry also impacts its high cost of living and the sheer number of people in the city at any given time can be overwhelming to those visiting from out of town. For those living in the heart of the city, costs will be much higher than for residents on the outskirts as the prices of goods and services have been raised to bring in money from willing tourists. While the city may be ranked tenth in the overall cost of living, certain goods far exceed this rank. For example, the average price of alcohol is second only to that of the ninth most expensive city in the world. For reference, the average cost for a bottle of table wine is $23.53 U.S. dollars; more than double that of many other countries.
9. Seoul, South Korea
Though it was only ranked 36th just five years ago, Seoul is now the ninth overall most expensive city in the world to live in. The high cost of necessities, like clothes and utilities, means that living in South Korea’s capital, home to over half of all South Koreans, can be quite costly. In fact, despite its ninth place ranking, Seoul is actually ranked first and the most expensive city for everyday food and groceries. The average cost for a 1kg loaf of bread in U.S. dollars, for example, is now $12.44. That’s more than double what it cost ten years ago and almost four times as much as the same sized loaf of bread in the current most expensive city in the world.
The high cost of living is also, in no small part, due to the cities large population of international residents. Nearly 700,000 foreigners live in Seoul, not including tourists, of which there were 10 million in 2014 alone.
8. Copenhagen, Denmark
Though this list is subject to changes from year to year, Copenhagen retains is position as the eighth most expensive city in the world to live in. The capital and most populated city in Denmark is home to just over 2 million residents in the metropolitan area as of 2016; a number significantly lower than some other cities in the top ten. But while the number of inhabitants might be lower than others, the quality of living is much higher. The city is regularly ranked among the highest in international surveys for this quality, and its stable economy, social safety and rich history make it one of the most livable cities in the world.
Relative to wages, however, the cost of living is pricey. But, unlike many other cities, you pay for what you get in Copenhagen. City life includes open spaces, favorable to pedestrians and cyclists, and easy access to public transportation which proves to be a stark contrast to many other expensive yet overcrowded cities.
7. New York City, U.S.
If you’ve traveling to the United States or live within its borders, you’ve probably visited New York City. As the counties largest, most populous city, it’s a huge international tourist attraction and with that, has quickly become the most expensive city in the U.S. to live in. That doesn’t mean it’s stopped anyone from moving there, however. New York City is home to over 8.5 million people and that number continues to grow each year. But as the population rises, so does the cost of living. While some cities have actually become less expensive to live in due to slow inflation, thanks to a strong U.S. dollar, localized inflation means New York is much more expensive in relation to other cities across the globe.
Tourism can also be thanked for the high cost of living. The money the city brings in each year from tourism means prices in many areas remain high. In 2014, tourism alone generated $61.3 billion U.S. dollars for the city. In order to stay, let alone live, in one of New York’s famed boroughs, it will cost big bucks, so it’s no wonder that until 2016, New York City was home to the most billionaires, later falling to Beijing, China.
After moving 15 places to become the seventh most expensive city in the world to live in, New York City holds the title for largest rank movement. At this rate, it may be posied to knock off the top spot in just a few years.
6. London, U.K.
As England’s capital and the most populated city in the entire United Kingdom, it stands to reason that London would land among the most expensive cities in the world to live in. Much like New York City and Los Angeles, London is one of the world’s leading cities in arts, entertainment, fashion and tourism, to name a few. It’s famed history and diversity also make it one of the most popular tourist destinations. In fact, measured by international arrivals, London is the world’s most visited city.
In addition to being a popular tourist destination, it’s also an incredibly popular city to live in. Over 8 million people make up London’s population, but it comes at a high cost to each one. The average price for a London property comes in at approximately £500,000 while the average annual income is only £30,000. Luckily, the cost of food and groceries in London is far below most other expensive cities. For a 1kg loaf of bread, Londoners pay, on average, $2.46 in U.S. dollars. Compared to a city like New York, who’s residents pay an average of $8.28, it’s relatively cheap. Alcohol and tobacco, however, are some of the most expensive.
5. Paris, France
Known to many as the City of Love, Paris is not only one of the most popular cities in the world for lovers, but for everyone else, too. The French capital and most populous city in France is home to over 2 million people and it goes without saying, a popular tourist destination for people from all over the world. With the likes of the Louvre, the River Seine, the Arc de Triomphe and of course, the Eiffel Tower, it’s clear that Paris attracts people from all walks of life. It may be one of the most popular cities in the world to visit, but to live here, you’ll have to pay up.
Weak confidence in the euro means that it’s the only city on the list within the Eurozone, a union of 19 of the 28 European Union states, but it still remains quite expensive to live in. While the cost of living can be high, unlike other European cities that make up this list, Paris surprisingly offers alcohol and tobacco at some of the lowest prices.
4. Geneva, Switzerland
With two cities in the top five of the ten most expensive cities in the world, Switzerland sure is a pricey place to live. Ranked fourth, the capital of the Republic and Canton of Geneva, Geneva is considered an all around costly city to live in. High price levels and income mean that Geneva is constantly vying, along with Zürich, for the title of Europe’s most expensive city and has already moved up three places in the last 12 months.
Much of this cost comes from Geneva’s greater premium on discretionary spending. For example, European cities are some of the priciest when it comes to entertainment and events. Noteworthy, however, is Geneva’s low price of alcohol. The average bottle of 750ml table wine comes in at just $8.06—almost a third of the cost compared to that of the most expensive city or even tenth overall, Los Angeles.
3. Hong Kong
While many may assume Hong Kong is a Chinese city, it’s actually a sovereign state that operates separately with its own independent political and economic system. In the last year, it has climbed seven spots to become one of the most expensive cities in the world to live in and for good reason. High housing prices coupled with an increase in local living costs means that Hong Kong’s 7 million plus residents pay a pretty penny to live in one of the world’s most significant financial centers.
It’s no wonder why housing has skyrocketed, though. With its high population reduced to just 427 square miles, Hong Kong ranks as the world’s fourth most densely populated sovereign territory, just slightly trailing the number one most expensive city in the world. With such a small space for so many people, the demand for housing is high and as such, real estate costs proves to be competitive.
2. Zürich, Switzerland
Switzerland makes its second appearance on the list of most expensive cities in the world to live in with Zürich. The capital of the canton of Zürich has essentially tied for second place with Hong Kong as both cities cost of living are on par with each other. With a much smaller population of nearly 400,000, however, Zürich is a considerably different city than Hong Kong.
In fact, Zürich is much more like its fellow Swiss city, Geneva. Though high income and price levels help Zürich reach the second spot, its high cost of entertainment and discretionary spending make it a pricey city to inhabit. The cost of petrol and tobacco may be consistently equal to that of Geneva, but one area that Zürich pulls ahead is with alcohol, which costs, on average, nearly double the price.
As the holder of many impressive titles, Singapore tops The Economist’s list of most expensive cities in the world. It’s also ranked as the world’s third most densely populated sovereign territory, just ahead of Hong Kong, as well as “easiest place to do business”, “most technology-ready” and country with the “best investment potential”, just to name a few. With a population of 5.6 million located in just 278 square miles, cost of housing and local living costs are relatively high compared to other expensive cities, though the value for essentials, like basic groceries, is considerably lower than other cities in the region and more closely matches those of cities further down the list.
Though it holds the title for the second consecutive year, Singapore’s large lead is shrinking. With the increase in costs of living elsewhere, such as New York City, Hong Kong and Zürich, it’s not likely that Singapore can hold onto the title much longer.
When they’re put in perspective, it’s clear why some of the most popular cities in the world are the most expensive to live in. With booming economies and the high cost of commodities, as well as housing, living in our favorite places becomes less and less financially viable due to such high demand. If people are willing to put up the money, average costs in most cities will steadily rise.
But that doesn’t mean that they’re any less accessible. As city population grows, so do their local tourism industries. This means that there will always be a place to stay and an attraction to see when visiting these pricey locales, with no shortage of things to do.
Source for world’s most expensive city list: