Singapore has increased four spots in the most recent global cost of living ranking, making it the 8th most expensive place in the world and the second most expensive in Asia. This is one of the conclusions of the most recent Cost of Living research published by ECA International on Dec 7.
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“The most significant factor behind Singapore’s rise in our recent ranking is the double-digit rise in rent costs for the year 2022.” states Lee Quane Regional Director – Asia for ECA International. “The Covid- 19 pandemic affected the availability of housing being offered for sale and the demand has risen significantly since Singapore’s reopening of its borders for the first time in a while.”
Although this could be a temporary surprise, it is the reason for Singapore’s current status in the top 10 most expensive cities around the globe Quane adds Quane.
“Despite the general trend of rising the rate of inflation across the globe, countries in Asia have experienced relatively lower increases, with nearly 65% of all locations surveyed within the region dropping in the current Cost of Living rankings,” Quane says. Quane.
Hong Kong drops to second place
Hong Kong, which came at the top of the rankings last year and is now down one position to be the second-most expensive place worldwide according to ECA International. Despite the high rate of inflation and the high value for the Hong Kong Dollar, its decline can be attributed to a decrease in hotel costs.
The demand for properties which are sought-after by expatriates plummeted in the context of it was reported that the Hong Kong economy stuttered in the in the face of a slowing growth in China and uncertainty in the enactment of the law on national security and the severe Covid restrictions.
“Like many other cities around the world, prices for everyday goods and services increased throughout Hong Kong at a rate that was higher than what we’ve observed in recent times, as well as exceeding the average growth rate observed across Asia. Asia regions,” says Quane.
The demand for rental properties slowed within Hong Kong because of its “sub-par economic performance in recent times” that caused rent prices to drop in turn , which resulted in the city’s fall in rankings, says Quane.
Chinese cities fell further in the rankings when compared to last year’s rankings and, in particular, Guangzhou and Shanghai falling out of the top 10 cities in the world. The Chinese Yuan was weaker in comparison to the US dollar, despite the moderate inflation rates according to Quane.
Japan is a country that has traditionally been seen as a nation that has a expensive cost of living, witnessed a major deviation from the norm in this year. The decline in the value of the Japanese yen of 20% per year when compared to the US dollar resulted in massive declines in the ranking of all Japanese cities studied. Tokyo is ranked as third in the world last year, is now off the list of top 10 cities cities this year, and Nagoya dropped 49 places to rank 87th.
New York – the most expensive city in the world
New York has been named the most expensive city around the globe, thanks to the power of the US dollar and the high rate of inflation, says Quane. This has also resulted in all the other US cities rising in the rankings this year, with San Francisco now in sixth and Los Angeles entering the global top 20.
However, the majority of European areas have seen declines in their position despite rising inflation rates triggered by rising food and fuel prices. This was mostly due to the weakening of the dollar and British sterling, which have reduced the cost of living in towns and cities less expensive compared to other cities in the world.
“Following the substantial decline in the value of the euro to equal to the US dollar European cities sank in the rankings despite rising inflation rates caused by the conflict that rages in Ukraine,” notes Quane. “Throughout all of the regions, just nine cities made it to the top of the rankings and London being among the nine. The eurozone wasn’t alone in this, as other currencies were also devalued in comparison to the US dollar.”