We have heard this thousands of times – Hong Kong is expensive. We had discussed this as part of the reason why Hong Kongers might not be that happy, and on top of our workaholic tendency we have to paid a lot to just exist. Just exactly how expensive in Hong Kong? Well, let’s have a look at UBS’s price and earning report again, which use New York as the standard index to measure the variety of costs etc. of 71 cities across the world. Picking out some of the factors in their report focusing on how Hong Kong do, we found a few interesting facts, but first here are some points to keep in mind:
The overall ranking, taking everything into account puts Hong Kong as the 24th most expensive city out of the 71 on the study, and our average cost of living index is 64.675% of that of New York. However, look at our net wage index, which is 51.3, means that in comparison to an average New Yorker, who earn 100 with expenses of 100, our living expenses are 26% higher.
The price level index, including rent indicates that it’s 72.9% of New York, second only to Tokyo in Asia and ranking at number 7 out of 71 cities. This would be more accurate than the calculated average, since this is based on average consumption over a three months’ period of 122 goods that a European family would use. Again, as stated before, that it would be slightly different to the spending of South East Asian households, but given that Hong Kong is a westernized city, it shouldn’t be too far fetched from the truth.
The costs that pulled down the calculated average is the cheapness of clothes, services and transport, though in general all of the costs we encounter are cheaper than New York, save for household appliances. We are the 4th most expensive city for buying home appliances in the world, costing a whopping 1,170 USD compared to the average 785 USD.
Housing is another huge contributor to expenses for Hong Kongers. Ranking number 2 behind New York for rent prices, it costs 4,410 USD to rent a furnished 2 bedrooms, 4,220 USD to rent an unfurnished 3 bedrooms with normal local rent 2,590 USD. However, the study did not state whether the size of the apartment is taken into account, so it is very possible that despite the parameters set to meet western preferences in terms of bedrooms in the property, the size would be significantly smaller.
Another interesting fact is that our domestic purchase power remains below 71 in both gross and net hourly rate, however, our net annual income is 99.3. However, in light of the working hours that an average Hong Konger works, it’s no surprise that we earn the difference back.
While food prices in Hong Kong are lower than that of New York, it costs us 511 USD to purchase the standard basket of good, which costs 400 USD on average. Whereas women’s standard work clothes only cost 350 USD and men’s 480 USD, putting Hong Kong at number 49 out of the 71 cities. Public transport, though cheap, puts us only at number 37 for bus, tram and metro. Taxi – you might be happy to find out, is at number 60 and train number 28.
For food and services, dining out at a decent restaurant will cost you 90% of what you will pay in New York, including services, but not drinks, putting us at joint number 24 with 8 other cities. Services are even cheaper, at number 48 and 55.3% of New York’s. However, the price of services such as household help and language courses relates to the local wages, therefore it would fluctuate a lot across the board. But it’s worth noting that even though female haircut can be up to three times more expensive in some cities, in Hong Kong – it’s the same for both genders.
Home electronics costs are similar across the board, as they are tradable and homogeneous in most countries. The average cost is 3,530 USD, and in Hong Kong it costs 3,480 USD.