The most and least expensive cities for expats, London ranks 30

03 July 2017 6 min. read
More news on

The growing need for organisations to meet globalisation strategies and talent demands across the globe has seen them become increasingly focused on improving the way they deal with international assignments. Mercer’s latest ‘Cost of Living Survey’ identifies trends related to the cost of living in various global cities, with London deemed the 30th most expensive city globally for expats.

Corporates across the globe are increasingly facing costs related to talent needs as expansion into various key regions, coupled with increased talent scarcity, calls for shuffling staff across global cities. In a new report from Mercer the human capital consultancy firm explores the cost of living related to various cities for the assigning of expats across the world’s major regions. Understanding the cost of living in a broad sense, and in relation to the US dollar, allows organisations to better plan assignments and prepare their staff for the new situation.

“Globalisation of the marketplace is well documented with many companies operating in multiple locations around the world and promoting international assignments to enhance the experience of future managers,” said Ilya Bonic, a Senior Partner ar Mercer. “There are numerous personal and organisational advantages for sending employees overseas, whether for long- or short-term assignments, including career development by obtaining global experience, the creation and transfer of skills, and the re-allocation of resources.”

Global ranking

Luanda the capital city of Angola is the most expansive city for international assignment. The possibly unexpected result is largely due to costs imposed by the Anglian government on goods and services to expats – goods are taxed at a higher rate and security is a must. Hong Kong takes the number two spot, with its rich cultural history and gateway status in Asia, coupled with tight supply for housing, makes it one of the most expansive places globally. Tokyo comes third, while Zurich takes the number four spot, the Swiss capital is one of Europe’s most plush cities, and is correspondingly, expensive. The city state of Singapore rounds off the top five.

Highest and lowest ranked cities globally

On the other hand, the world’s least expensive cities are spread largely in Central and Eastern Europe, with Central America and Africa housing three of the lowest ranked cities. Tunis, which continues to find itself in strife, is the least expensive city. Bishkek, the capital and largest city of Kyrgyzstan, takes second to lowest spot, followed by Skopje and Windhoek.

Western Europe

Aside from Zurich, two other Swiss cities make the top ten. Geneva ranks at number seven globally and number two in the region, while Bern is listed as number 10 globally and number three locally. London has seen its place in the rankings fall, largely due to the drop in the value of the sterling since the Brexit result, the city fell thirteen places on last year. Aberdeen and Birmingham too saw falls, at sixty-one and fifty-one spots respectively.

Highest ranked city by region western Europe

Paris was meanwhile down eighteen places to 62. While various German cities ranked relatively far down in the global rankings, Munich (98), Frankfurt (117), and Berlin (120), Dusseldorf (122) and Hamburg (125).

“Despite moderate price increases in most of the European cities, European currencies have weakened against the US dollar, which pushed most Western European cities down in the ranking,” explained Nathalie Constantin-Métral, Principal at Mercer. “Additionally, other factors like the Eurozone’s economy have impacted these cities.”

North America

The US saw a number of high level entries, including New York City at number 9 globally and number one for the region. The city is home to some of the world’s biggest financial clout, as well as being an iconic brand. San Francisco takes the number two spot for the region and number 22 globally. The heart of Silicon Valley is well known for its pricy real estate and costly culture. Los Angeles takes the number three spot for the region, and number 24 globally. Chicago, up two places on the year previous, and Honolulu take the number four and five spots respectively. The least expensive places in the US remain Portland (115) and Winston Salem (140).

Highest ranked city by region North America

Constantin-Métral commented: “Overall, US cities either remained stable in the ranking or have slightly increased due to the movement of the US dollar against the majority of currencies worldwide.”


Asia host five of the world’s top ten most expensive cities, including Hong Kong on number two, with prices pushed up by the US dollar which further drove up the cost of accommodation. Tokyo comes in at number three, also in part due to currency fluctuations, Singapore at number 5, Seoul at number six and Shanghai at number eight.

Highest ranked city by region Asia

“The strengthening of the Japanese yen along with the high costs of expatriate consumer goods and a dynamic housing market pushed Japanese cities up in the ranking,” stated Constantin-Métral. “However, the majority of Chinese cities fell in the ranking due to the weakening of the Chinese yuan against the US dollar.”

In Asia more widely, Bangkok jumped seven spots to number sixty seven, while Jakarta and Hanoi rank 88 and 100 respectively, rising in the ranks by five and six spots respectively.