Just who are expats expected to believe when rankings of the cost of living in world cities are at odds with each other?
Today is a good example.
Two venerable institutions have released their rankings on the same day, but show completely different results.
The Economist Intelligence Unit, the respected research are of the well-known magazine has gone head to head with international property consultants Savills.
The Economist ranks Singapore as the world’s most expensive place to live, while Savills says it’s Hong Kong.
However, Hong Kong does not show in The Economist top 10, while Savills ranks Singapore as the fifth costliest place to live.
Who do expats believe?
The rankings are considered important by expats because multinational firms base their housing allowance payments on the results.
The problem is an expat working for a firm basing their salary, benefits and housing allowances on The Economist figures could end up with a pay packet vastly different from another firm basing the money they pay on the Savills figures.
Here is The Economist top 10:
- Singapore
- Paris
- Oslo
- Zurich
- Sydney
- Caracas
- Geneva
- Melbourne
- Tokyo
- Copenhagen
While this is Savills’ top 10:
- Hong Kong
- London
- New York
- Paris
- Singapore
- Tokyo
- Dubai
- Moscow
- Sydney
- Shanghai
The cities on both lists are in bold
What the surveys say
The Economist gives several reasons why Singapore is their most expensive city.
“The city also has expenses that skew the cost of living,” says the report. “Car costs have high fees attached, which makes Singapore significantly more expensive than anywhere else for running a car.
As a result, transport costs are almost three times higher than in New York.
“As a city-state with few natural resources, Singapore is reliant on other countries for energy and water supplies, making it the third most expensive destination for utility costs. Expensive malls import luxury European brands to satisfy wealthy and fashion conscious customers, making Singapore the priciest place in the world to buy clothes.”
The Savills survey includes the costs for companies to provide work space for employees, which probably means the results are not directly comparable to those from The Economist.
Yolande Barnes, director of Savills World Research said: “The figures show how old world cities are more stable than those in emerging economies, where growth seems to have slowed dramatically in many locations although places like Rio and Dubai counter this argument”