Costlier than US, France: three Gulf states rank in world's top 10 most expensive cities to rent

Costlier than US, France: three Gulf states rank in world's top 10 most expensive cities to rent
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Published February 12th, 2015 - 18:06 GMT via SyndiGate.info

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The report is based on average prices for each country, rather than specific cities.
The report is based on average prices for each country, rather than specific cities.

Qatar, the UAE and Kuwait claimed the third, fourth and 10th rankings respectively in a cost of living index for the most expensive rents in the world, a report said.

Rents in Bahrain are the 13th most expensive in the world on average, according to the Numbeo Cost of Living Index 2015, reported the Gulf Daily News (GDN), our sister publication.

On a country-by-country basis, it is more expensive to rent in Bahrain than in the US, Denmark and France.

Bahrain ranks 33rd overall in terms of total cost of living, including rent and consumer goods and services, out of a total of 119 countries surveyed.

The most expensive country was Switzerland followed by Singapore and Norway, while Nepal was cheapest behind India and Pakistan.

The report is based on average prices for each country, rather than specific cities.

It found that Bahrain has the worst local purchasing power in the GCC, ranking 44th worldwide.

The country had the 48th most expensive groceries worldwide and fourth most expensive in the GCC.

It also had the 42nd most expensive restaurants worldwide, again putting it at fourth in the GCC.

'We generally see little cross-country movements in our Cost of Living Index,' Numbeo Doo chief executive Mladen Adamovic told the GDN.

“It seems that status quo is a default state of economies worldwide. Some economies are suffering due to cheaper oil prices, but I see that Bahrain's dinar is stable.

“Therefore, I'm not expecting Bahrain to become cheaper or more expensive in the near future."

However, Bahrain Chamber of Commerce and Industry (BCCI) first vice-chairman Othman Al Rayes said price fluctuation depended on whether the government stopped subsidising essential items.

In 2013, the state spent BD1.535 billion ($4 billion) on support schemes and subsidies on things such as food, petroleum products, gas, water and electricity.

Concerns about Bahrain's growing budget deficit, along with lower oil revenues due to a dramatic drop in prices, have prompted speculation that subsidies could be reduced to save money.

The government has previously stressed the need to overhaul the subsidy system and Al Rayes said if that happened Bahrain could become a more expensive place to live.

"The problem is that Bahrain always tries to stay low on the cost of living, so that there isn't a sort of inflation," he said.

"But if the government removes subsidies for essential things, such as oil, gas and food items, it will increase prices, which will increase the cost of living.

Challenge

"If we continue as we are, it will create issues for the budget, especially with the plummeting oil prices.

"If we combine all of this with national debt, it will be a challenge for the government to maintain this cost of living, both in the long and short run.

"It's going to be affected and the government won't be able to keep prices at their current levels and keep this cost of living down," he said.

The Numbeo Cost of Living Index 2015 is calculated relative to prices in New York City, US. 

Copyright 2015 Al Hilal Publishing and Marketing Group

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