Some analysts say housing prices will drop in cities as a result of coronavirus outbreak
Hong Kong, Singapore and Osaka were named as the world’s most expensive cities on Wednesday but researchers warned that the coronavirus outbreak could change the ranking.
Singapore and Hong Kong topped the list for a second year running and tied with Osaka in Japan which pushed Paris from third place to fifth after New York in the 2020 Worldwide Cost of Living Survey from the Economist Intelligence Unit (EIU).
The only Middle Eastern city in the top 10 was Tel Aviv at No. 7 due to booming exports strengthening the Israeli shekel.
Damascus, the capital of Syria, was rated as the cheapest city in the world, with Tashkent in Uzbekistan the second cheapest in the survey of 160 items in 133 cities including clothing, transport, food and energy bills.
But Nicholas Fitzroy, senior data analyst at EIU, said the impact of coronavirus, that has infected more than 200,000 people worldwide and killed almost 9,000 so far, would hit the prices in the most expensive cities.
He said the pandemic had hit the tourism industry, with fewer visitors and lockdown measures, and also export industries.
“The general trend will be of the cost of living falling,” Fitzroy told the Thomson Reuters Foundation from London.
“It’s probably going to have a bigger impact in terms of that dampening trend on the top 10 cities because if you look at the some of the cities in the bottom 10, tourism isn’t going to affect Damascus particularly or Caracas.”
Higher costs of living in cities was often seen as a reflection of a thriving job market that attracts skilled workers with higher wages.
Anthony Breach, an analyst at the British think tank Centre for Cities, said housing prices will drop across cities globally as a result of the crisis caused by the coronavirus.
“It’s a very bad way of improving affordability,” Breach said. “It’s not because people are able to buy more stuff, it’s because people are poorer.”
Fitzroy said the cheapest cities at the bottom of the table, many of which are in South Asia, could experience an increase in the price of goods and services if they were not globally connected.
“If borders start closing that may impact the suppliers so some of the more basic goods may struggle to be found,” he said.
Source: Newstrust
