Julius Baer’s Lifestyle Index ranks the world’s 25 most expensive cities by analyzing residential property, cars, business class flights, business school, degustation dinners and other luxuries. Asia remained the most costly region for luxury living for the fourth straight year.
The survey found rising demand for travel and entertainment as pandemic restrictions were lifted and freedom returned. India’s Mumbai rose to the eighteenth rank from the twenty-fourth rank last year
Meanwhile, reinforcing its position as the most costly region to live well for the fourth year, Asia continues to dominate the global city rankings. In the past 12 months prices in local currency for all Index items in the region have risen on average 13 per cent, some significantly more. Hotel suites, business class flights, and cars have seen the highest average rises of all regions: hotels by 39.1 per cent, flights by 32.9 per cent, and cars by 25.2 per cent.
Between cities there have been notable changes. Singapore has taken the top global and regional rank, overtaking Shanghai, Hong Kong, and Taipei. Although Shanghai slides into second place, it remains an expensive city, but average prices in local currency rose only 3 per cent – the lowest increase of all cities – seemingly due to the ongoing pandemic restrictions in 2022. Hong Kong, which saw final restrictions lift before Shanghai, has seen prices continue to rise, notably in hospitality – hotel suite prices rose by 102 per cent and fine dining by 45 per cent on average.
Among other cities in the region, two distinct pictures emerge. Those in developed economies such as Tokyo and Sydney continue to slip down the rankings, while those in developing economies such as Bangkok, Jakarta, and Mumbai increasingly rise. The Japanese yen has had a turbulent 12 months, particularly against the dollar when prices are converted for global comparison. Prices in Tokyo in local currency have risen for all but one Index item (fine dining -2 per cent), and prices in Japan are said to have risen at their fastest rate in four decades during 2022.
In Asia’s developing economies there is impactful growth coupled with strong price increases in consumer goods – local currency prices in Jakarta rose an average of 22 per cent, the highest increase globally. Bangkok, Jakarta, and Mumbai are all likely to continue to challenge their more established neighbours for higher places in the city ranking.
Across the region, our Lifestyle Survey shows that people are on the move again, with the highest rises globally in use of commercial flights and private vehicles. Demand for hospitality and travel will continue, while discretionary spending on fashion and luxury goods is likely to maintain momentum, particularly since the reopening of China at the start of 2023.
