London is the sixth most expensive location to live in the world, largely attributed to high rental accommodation costs in areas popular with expatriates, which are almost a third higher in than in Geneva, and twice as high as in Paris, a new study has found.
The Cost of Living report from global mobility specialist, ECA International (ECA), analysed costs of consumer goods and services in around 480 locations.
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Steven Kilfedder, production manager at ECA, explained London’s high ranking was because “the British pound has rebounded from the lows reached last year when uncertainty over Brexit culminating in a general election pushed the value of the pound down. Since then the pound has gained strength, which means visitors and international assignees visiting and living in the UK may find goods and services more expensive.”
“With Brexit negotiations reaching another crunch point this could have a significant impact on the UK’s ranking in the future through exchange rate changes and possible inflation due to increased trading costs,” he added.
The comparative strength of the British pound pushed UK cities up the rankings with Edinburgh and Manchester also in the top 100.
Hong Kong claimed the top spot globally, followed by Tokyo, New York and Switzerland’s Geneva and Zurich.
Kilfedder said that Hong Kong’s “especially high housing costs that push it to the number one spot. This is despite seeing some lower prices in the last year in response to a drop in demand due to the pandemic and ongoing political uncertainty.”
European countries make up 40 of the top 100 most expensive locations in the world thanks in part to the strength of the euro, pound and Swiss franc.
Swiss cities Geneva and Zurich are the most expensive in Europe and fourth and fifth globally, while London ranks the third most expensive location in Europe, followed by Copenhagen and Bern. Eurozone locations Paris, Dublin, Helsinki and Munich rank in the top 50 globally.
Meanwhile, once a costly place for businesses to send expatriates, Iceland’s Reykjavik is now ranked as the 63rd most expensive location to live, as the loss of tourism due to COVID-19 has impacted the currency, driving down costs.
This trend was seen in numerous tourism hubs that have suffered the economic effects of minimal tourism as a result of the pandemic.
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