Photo: Simon & His Camera/Flickr
For five years in a row, Hong Kong has topped Savills’ ranking of the 12 most expensive cities in the world to work and live. However, this year, London forged ahead in the real estate firm’s annual index which takes into consideration rental costs for both living and work spaces.
According to the report, the average real estate costs per employee in London have risen to $120,568 (US) a year. Hong Kong and New York City followed with $115,717 and $107,782 respectively.
Why the sudden change up? Living in Hong Kong and renting work space still remains incredibly pricey, but falling residential prices and a weakening currency in Hong Kong has resulted in more cost competition.
London has also witnessed a huge increase in real estate costs. According to the World Cities Index, residential prices have risen 18.4 per cent in just one year. Looking at office rents, they’ve shot up by 31.1 per cent since 2008.
These rising costs come with a warning as to the competitiveness of the global city. The report notes that “gentrification has priced out new start-ups and the vitality of central London locations are at risk as they become too expensive for the types of occupiers that made them attractive in the first place.”
New York City overtook Paris on the list. However, the French capital is still the most expensive city for tech companies to set up shop.
Here’s a look at the full ranking of the 12 cities: