Living in a global city with a high quality of life is increasingly reserved for the wealthiest.
Last year, the Economist’s Intelligence Unit (EIU) published its influential ranking of the living conditions in 173 global cities, measured by a range of factors in five categories: stability, healthcare, culture and environment, education, and infrastructure. It ranks cities based on the quality of these aspects of life, but not on their cost.
The cities with the highest quality of living include:
- Vienna, Austria
- Copenhagen, Denmark
- Melbourne, Australia
- Sydney, Australia
- Vancouver, Canada
- Zurich, Switzerland
- Geneva, Switzerland, and Calgary, Canada (tied)
EIU’s livability ranking is designed, in part, to help employers determine how challenging it is to live in a particular city, so they can adjust their employee incentives accordingly.
“Assessing liveability has a broad range of uses, from benchmarking perceptions of development levels to assigning a hardship allowance as part of expatriate relocation packages,” EIU says in its report.
But one major factor is missing — one that most people considering a move would need: the cost of living. It’s especially important now amid high global inflation and widespread housing crises. While inflation globally has slowed in 2023 to 7.4% year-over-year (from 8.1% inflation in 2022), according to EIU, the costs of things like housing, groceries, clothing, and recreation are still rising too quickly for many.
Some of the most liveable cities — like Zurich, Geneva, and Copenhagen — are also among the most expensive cities in the world this year, according to EIU’s Worldwide Cost of Living Index.
The cities with the highest cost of living include:
- Zurich and Singapore (tied)
- Geneva and New York (tied)
- Hong Kong
- Los Angeles
- Paris, France
- Copenhagen and Tel Aviv, Israel (tied)
EIU looks at “400 individual prices across more than 200 products and services” to determine the cost of living in 173 cities around the world.
The world’s most liveable cities — for the wealthy
The rising cost of housing, food, and other household goods is helping worsen the affordability crisis in these cities. In the US, rising rents and home prices have been the biggest drivers of inflation in recent years.
Some cities with the highest quality of life have managed to remain somewhat affordable. Vienna, for example, has kept housing costs remarkably low through its generous social housing system. But others, like Vancouver and Sydney, can’t say the same — both are facing housing shortages and affordability crises.
While Switzerland has one of the wealthiest populations of any country in the world, it has the lowest homeownership rate — 36% — in the West, The New York Times recently reported. The average studio apartment in Zurich costs $1.1 million and the average home across the country costs $1.4 million, the Times reported. Remarkably, the cost of housing per square foot in Zurich is 80% more than in Paris, the world’s fifth-most expensive city.
There are strict limitations on when landlords are allowed to raise rent, but the spike in interest rates means rents could rise up to 15% across Switzerland by 2026. Like in many American cities, a severe housing shortage in cities like Zurich and Geneva is also contributing to rising home costs. The strength of the Swiss franc and the rising cost of groceries and household goods have also contributed to Zurich and Geneva’s high cost of living.