Rising housing costs has pushed Dubai up the rankings in an annual survey of the most expensive cities in the world for expatriates to live in.
Dubai is ranked as the 67th most expensive city for expats among 211 cities across the globe, having shot up 23 places from 90th in 2013, according to the 2014 Cost of Living Survey released by human resources consultancy, Mercer, on Thursday.
The world’s most expensive cities for expats are both in Africa. Luanda in Angola is ranked first for the second year, followed by N’Djamena in Chad.
Hong Kong occupied the third spot, followed by Singapore, Zurich, Geneva, Tokyo, Bern, Moscow and Shanghai. London and New York were a little far behind at number 12 and 16, respectively.
Dubai, meanwhile, emerged as the third most expensive city in the Middle East for expats , after Tel Aviv and Beirut. Abu Dhabi follows Dubai at number four. Jeddah, on the other hand, ranked the region’s least expensive city.
“Several cities in the Middle East experienced a jump in the ranking , as they are being pushed up by other locations’ decline, as well as the strong increase for expatriate rental accommodation costs, particularly in Abu Dhabi and Dubai,” stated Nathalie Constantin-Métral, Mercer’s Principal.
The survey compares the price of housing, transportation, food, clothing, household goods and entertainment in the world, with currency movements having been measured against the US dollar.
In previous years, employees in the UAE considered stability and a company’s reputation, in addition to salary, before taking up a job, said Rayhana Levy, recruitment and team manager at Hays, a recruitment firm. However, as rental rates and other costs go up, employees today “look at money as a key motivational factor [before accepting a job],” she told Gulf News.
As property sales and value growth decline, the rise in rental charges is becoming a key driver in Dubai’s residential property market. Rental growth in Dubai outstripped that in London and Hong Kong in the first three months of the year, according to a recent report from real estate consultancy, Knight Frank. “In Dubai, prime rents continue to outpace wage inflation. This is raising concerns about affordability,” it stated in the report.
Meanwhile, few other African cities were ranked among the top 20 most expensive cities for expats, as a result of high living costs and prices of goods for expatriate employees. Victoria in The Seychelles was at number 13, followed by Libreville in Gabon at number 19.
Karachi, meanwhile, ranked 211, as the world’s least expensive city.
Cities in Australia and Canada, however, went down the rankings. As the Australian dollar has depreciated against the US dollar, Sydney is ranked as the 26th most expensive city for expats, while Melbourne is ranked 33rd, having dropped 17 places from last year. And Perth at number 37, fell 19 places. Vancouver in Canada, meanwhile, fell 32 spots to 96th this year.