Brexit vote 'has made London cheaper to live and work in'

Staff reporter(wp/es):

London is no longer the most expensive city in the world in which to live and work, a study has found.

The capital has previously topped lists for cost of living, but is now ranked third behind New York and Hong Kong, according to estate agents Savills. 

Experts said the drop from number one to three on the list of the most expensive cities on earth was in part due to the fall in the value of the pound after the Brexit vote.

The estate agents said accommodation for the average Londoner – calculated as a total of housing and office rental costs – now stands at a total of £71,000.

Top ranked New York (£90,700) and Hong Kong (£85,000) are both now more expensive than the capital.

London now ranks closer to Paris (£60,900) and Tokyo (£60,000).

This is according to the latest Savills Live-Work Index, which is put together annually as an indicator for companies of the cost of doing business in different world cities.

With housing costs a major factor, the data gives an idea of the cost of living for professionals in the capital relative to other global cities.

By this measure, London is now 10 per cent cheaper than it was in December 2008.

Yolande Barnes, director, Savills World Research, said: “The real test of whether a city is good value for occupiers lies in how productive an organisation can be in that city and how competitive a city is in attracting human capital to its job market.

“Cities may become more or less competitive on a short term basis but it is their long term costs that need to be taken into consideration when signing leases or building accommodation.

“For successful organisations, business location is a long-term play, not a short-term decision so sound business fundamentals are of course far more important than decisions based on the cost of accommodation at a given point in time.”

“London’s relative advantage may be eroded if sterling rallies but our view is that the appeal of London as a world city will continue.”

Other English-speaking cities such as San Francisco, Los Angeles and Sydney are also found in the top 10.

And elsewhere Dublin and Berlin, both often cited as potential post Brexit alternatives to London, still represent savings of over £30,000 and almost £50,000 respectively.