The world's most expensive and cheapest cities to live in

Find out where city living costs the most, according to the latest World Cost of Living Survey.

Singapore is the world’s most expensive city to live in, while Mumbai is the world’s cheapest.

That's according to research from the Economist Intelligence Unit (EIU) published in its latest Worldwide Cost of Living Survey.

The EIU compared more than 400 individual prices across 160 products and services in 140 cities spanning 93 countries.

The research group analysed what locals pay for things like rent, food, drink, clothing, household supplies, transport, utility bills, private schools, domestic help and recreation.

The survey is regarded as an important tool and is used by businesses to calculate cost of living allowances and compensation packages for employees who travel on business or employees who relocate.

Information is collected in March and September and published twice a year.

The ten most expensive cities to live in

Source: The Economist Intelligence Unit

A weaker Yen has pushed Tokyo off the top spot, paving the way for Singapore to claim the unenviable title of world’s most expensive city.

[SPOTLIGHT]Currency appreciation coupled with price inflation has consistently pushed Singapore up the rankings over the last decade. Ten years ago the city was ranked 18th and it's moved up five places since 2013.

However, it's actually a few items that skew the overall cost of living upwards in the city.

Car ownership, for example, is strictly regulated in Singapore to prevent congestion on the island and there is a licensing system which requires drivers to buy a ‘certificate of entitlement’ before they can buy a car. As a result, transport costs are three times higher than in New York.

The city is also reliant on other countries for energy and water supplies, making it the third most expensive city for utility costs. While the explosion of expensive malls and boutiques, which import luxury European brands to satisfy Singapore’s high earners, has made the island the priciest place in the world to buy clothes.

Expensive Europe

European cities accounted for three of the five most expensive cities and Paris, Oslo, Zurich, Geneva and Copenhagen all made the top ten. London was the 15th most expensive city.

However, unlike Asian cities, no one particular category pushed the price of living up. Instead, costs tend to be generally high on a range of things. 

Paris, for example, which now ranks as second most expensive city in the world was costlier than most locations for seven out of ten categories used in the survey.

The research did note that European cities tend to be more expensive for recreational and entertainment activities, while Asian cities tend to be the priciest for everyday food items.

According to the experts at the EIU, Europe has been the subject of renewed optimism as economic data starts to improve, and that makes the cities relatively expensive once more.

Caracas in Venezuela is Latin America's representative in the ten most expensive cities list, but its position is largely due to an artificially high official exchange rate. According to the EIU, if alternative 'black market rates' were applied Caracas would comfortably become the world's cheapest city to live in.

After Caracas the most expensive city in the Americas is New York in 26th place, with the US city becoming more expensive than Vancouver in Canada over the last year.

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Ten cheapest cities to live in

Source: The Economist Intelligence Unit

While Asia is home to some of the most expensive cities in the world it also has some of the cheapest cities too. Four of the ten cheapest places are located on the Indian subcontinent in India, Pakistan and Nepal.

Mumbai in India was found to be the world’s cheapest city to live in, while the Indian capital New Delhi came in third.

India has been tipped for growth because of its large population and untapped economic potential. But income inequality mean low wages are widespread, which drives down spending and creates different tiers of pricing. Because of the cheap and plentiful supply of goods, combined with government subsidies on some products, prices have been kept down.

Outside of India some of the world’s other ten cheapest cities face domestic unrest and security concerns.

The ancient city of Damascus in Syria, for example, saw the biggest drop of 11 places on the latest list, becoming the fourth cheapest city in the world as the country's ongoing conflict continues to have a negative effect on its currency.

Panama City in Panama and Riyadh and Jeddah in Saudi Arabia, on the other hand, offer a cheaper cost of living in more stable environments. Saudi Arabia, for example, has price controls on staples, guaranteeing low prices for many goods.

The only European city to feature in the top ten cheapest cities to live in was Bucharest. While wages are low here, prices are too. The relative value for money offered in the Romanian capital city arguably goes some way to explain why a flood of migration failed to take place when EU restrictions were lifted in January 2014.

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