Hong Kong is no longer the world's most expensive location for expats

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The city accedes first place to New York, while Singapore climbs eight places to mark its first time in the top five.

Hong Kong has been surpassed by New York, dropping one place to become the second-most expensive location in the world for expatriates, according to ECA International’s latest cost of living rankings.

Despite historically high rates of inflation, Hong Kong still fell in the rankings as prices rose at a faster rate in New York and accommodation costs continued to fall in Hong Kong in 2022.

This shift marks the end of Hong Kong's four-year reign at the top.

"Costs for goods and services in Hong Kong rose at multi-year highs, showing that the city was not spared from the wave of inflation we have seen throughout the world in the past year," said Lee Quane, Regional Director – Asia at ECA International.

"In spite of this, Hong Kong fell in our rankings as the increase in prices of day-to-day goods and services was tempered by falls in accommodation costs in the city."

Top 10 most expensive locations for expatriates in the world

1. New York (2022: 2^nd place)
2. Hong Kong (2022: 1^st place)
3. Geneva (2022: 3^rd place)
4. London (2022: 4^th place)
5. Singapore (2022: 13^th place)
6. Zurich (2022: 7^th place)
7. San Francisco (2022: 11^th place)
8. Tel Aviv (2022: 6^th place)
9. Seoul (2022: 10^th place)
10. Tokyo (2022: 5^th place)

Asia highlights

Nearly all major locations surveyed in Asia have dropped in the rankings, indicating that expatriates will find living in Asian cities relatively cheaper than in the rest of the world in the past year.

That said, Singapore is one of the few locations in Asia that moved up the rankings this year, where we see the city has risen eight places to the fifth spot, marking its first time in the top five.

"Increased demand for rental accommodation in the Lion City, driven by factors such as the earlier relaxation of COVID-19 restrictions compared to other key locations in the region, was not matched by corresponding increases in the supply of suitable accommodation," explained Quane.

Top 10 most expensive locations for expatriates in Asia

1. Hong Kong (2022: 1^st place)
2. Singapore (2022: 13^th place)
3. Seoul (2022: 10^th place)
4. Tokyo (2022: 5^th place)
5. Shanghai (2022: 8^th place)
6. Guangzhou (2022: 9^th place)
7. Shenzhen (2022: 12^th place)
8. Beijing (2022: 14^th place)
9. Taipei (2022: 20^th place)
10. Yokohama (2022: 17^th place)

Seoul and Yangon also bucked the trend of falling rankings in Asia, as Seoul climbed one place to ninth and Yangon rose four places to 167^th.

Chinese cities fell in the rankings due to the impact of a weaker Chinese yuan and lower rates of inflation compared to other countries. Shanghai and Guangzhou, while retaining their status as the most expensive cities in China, have fallen out of the global top 10 and now rank as the 13^th and 14^th most expensive cities in the world. Cities in Taiwan have also seen double-digit drops in rankings, with Taipei sliding 11 places to 31^st spot globally.

Similarly, Japanese cities also witnessed significant falls in the rankings as currency depreciation counteracted inflation rates that are at multi-year highs. Tokyo, which was consistently among the top five globally in the past five years, has dropped five places to 10^th.

“For companies moving staff from Japan, the result of Japanese cities’ fall in our rankings owing to a weaker currency means that companies may have to pay more in order to ensure that their employees’ purchasing power is protected whilst they are overseas,” highlighted Quane.

In Southeast Asia, Bangkok, the second most expensive city in the region after Singapore, dropped 13 places to become the 60^th most expensive location in the world for expatriates.

Elsewhere in the region, Manila fell nine places to 75^th, while Jakarta dropped 22 places to 114^th. In Malaysia, Kuala Lumpur dropped 12 places to 175^th, while George Town, Kota Kinabalu, and Johor Bahru also experienced slight drops in their rankings, landing at 189^th, 195^th and 198^th respectively.

ECA International's cost of living rankings combine ECA’s cost of living as well as accommodation research to compare costs faced by expatriates around the world in 207 cities in 120 countries and territories.

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Lead image / ECA International's cost of living rankings