This is what it will cost to rent a flat in the world’s most expensive cities. But that's nothing compared to buying.
Dreaming of living in Monaco? Hope your pockets are extremely deep. No matter whether you rent or buy, you’ll be paying the world’s most expensive property prices. That’s according to Global Property Guide, which pegs the the average price of renting a 120 sq m (1,292 sq ft) apartment in a prime area of the high-flying, big-spending paradise at $10,099 per month.
Next on the list is London, at $6,856 per month with New York hot on its heels at $6,553. Outrageous.
But if you think renting’s a rip-off — and you actually have the dosh to even think about getting onto the property ladder — look closely at our infographic to see just how many years’ worth of rent it takes for you to purchase the exact same flat in these places: In Monaco you’ll be coughing up 53 years worth of rent and in London it’s 48. Ouch. Meanwhile, over in New York it’s a factor of 23, Moscow 26 and Tokyo 18 — making these famously pricy cities almost sound like bargains.
Meanwhile, if Hong Kong's your destination, my local friends say forget sealing a deal like this in ritzy Repulse Bay or on The Peak, where prices are through the roof — if the average $6,198 price is your limit, you'll more likely find yourself in Happy Valley, Ap Lei Chau or forsaking Hong Kong proper for some laid-back, outlying island. And don’t forget that the square footage can include every nook and cranny: the lift lobby, windowsills, even the mailbox!
But there are other factors, too. Granted, 53 years of rent at $10,099 per month in Monaco sounds simply absurd, no matter how spectacular the sea views or how fresh the fish, but don’t forget that it comes with a few major perks. No, we’re not talking about yacht junkets and complimentary Formula 1 Grand Prix tickets, but taxes. Establish residency (as a renter or owner) and you can pretty much kiss paying income, wealth and capital gains taxes goodbye. (Unless you’re American, in which case you get taxed on everything, everywhere, forever.) OK, you’ll need to make a hefty bank deposit, and prove you’re an upstanding individual, but if you can swing it, you’re golden.
Conversely, over in Amsterdam, your rent and price/rent ratio may be relatively more down-to-Earth, but you could be paying a pretty penny to the Taxman – the Netherlands has the dubious honor of levying one of the highest marginal income tax rates in the world.
Granted, property prices are extremely dynamic and all it takes is another rash of bedbugs or SARS outbreak to send prices in New York and Hong Kong tumbling. Yes, we’ve seen it before.
Check out the numbers for your city, and then let’s discuss whether the smart money rents or buys.
By Lauren Cooper
Lauren Cooper is a TransferWise revolutionary, globe-trotting journalist and battle-hardened expat. An expert on life in the world’s most expensive cities, she grew up in New York before doing tours of duty in Hong Kong and London.