Savills announce Live - Work Index 2018

26 October 2018

Hong Kong has overtaken New York to become the most expensive world city in which to rent space for the first time since 2011, according to the latest Savills Live/Work Index. London, which held the top spot from 2011 to 2015, now ranks number three behind New York.  But the big story of the past year has been the rising cost of accommodating employees in leading European and Chinese cities (see full table below).

The average rental cost of office and residential space per employee in Hong Kong now stands at US$112,400 per year, having risen 5.0 per cent in the past twelve months.  The equivalent space in New York costs US$108,200, down -1.7 per cent year on year, while the London rent bill slipped -1.3 per cent in sterling terms to US$96,000.  Exchange rate fluctuations mean that London actually looks 2.7 per cent more expensive to the dollar operator than last year.

Residential rents have been driven higher in Hong Kong due to limited supply, particularly in the prime markets, office rents have been inflated by demand from mainland firms as well as new tech and co-working operators.  At the same time, New York residential rents have continued to be suppressed by a supply glut, while office rents have fallen slightly as employers look to shrink their footprint and ‘densify’ their office space.


The UK capital remains far the most expensive European city in which to accommodate workers, but the gap is beginning to close.  Fast-growing city economies are fuelling rent rises, while a strengthening Euro has made these cities more expensive for occupiers from outside the Eurozone. 

Amsterdam now ranks number two in Europe after costs shot up 16 per cent in dollar terms over the past year (11.3 per cent in local currency terms), driven largely by rising residential costs.  The per employee Live/Work cost now stands at US$62,800, still around a third cheaper than London, but prices continue to rise.

Other European cities are also coming under the Brexit spotlight.  Dublin and Paris, both in the Savills top 10, have seen costs rise by 9.4 per cent and 4.6 per cent, to US$59,900 and US$58,100 respectively.  Brussels (+6.6% to $50,200),  Stockholm (+9.3% to $45,500), Madrid (+13.7% to $40,600), Frankfurt (+10.2% to $38,400) and Berlin (+13% to $32,100) – have all seen costs rise well above the index average of +5.2 per cent, but still represent relative value compared to the index leaders, for now at least. 


Across Asia, Hong Kong is in a league of its own cost-wise, but mainland Chinese cities have risen rapidly up the rankings over recent years.  The most expensive, Beijing, has total rental costs at just US$54,900 per person, less than half the Hong Kong total, down -0.2 per cent (-5.5% in local currency) year on year as measures aimed to stabilise the market stay in place.

Shenzhen has risen from 20th to 16th place in the Savills index, experiencing one of the largest increases in the index.  Costs rose by 14.4 per cent in local currency and 20.9 per cent in dollar terms, to US$48,700, just behind Shanghai at US$49,300.  Population growth due to internal migration means residential rents in the city continue to trend upwards.  Demand for office space also remains high, particularly from the financial, professional services, high-tech and advanced manufacturing sectors, as well as co-working operators.

Rental growth in other Chinese cities has ranged from 8.0 per cent in Chongqing to 22 per cent in Tianjin, the highest rate of growth in the Savills index.  Despite this growth, the per employee Live/Work bill equates to around one seventh of the cost in Hong Kong.

“The cost of accommodation is only one driver when companies are deciding where to locate office hubs, but this analysis gives insight into the shifting relationship between world cities over time,” says Sean Hyett, Savills World Research Analyst.  “Rising costs, both for residential and commercial space, are a barometer of a city’s success at a point in time, but the mid to long term fundamentals of a given city and its country’s broader economy are the best guide to likely future occupier costs as well as yields for investors.

“The fact that London has retained its significant lead over other leading European cities despite high levels of uncertainty surrounding the Brexit negotiations, points to its fundamental appeal as a place to live and do business.”

Savills Live/Work Index US Dollar Local currency
Cities Current Ranking Current cost per employee % 1 year (to H1 2018) % 1 year (to H1 2018)
Hong Kong 1 $112,400 4.4% 5.0%
New York 2 $108,200 -1.7% -1.7%
London 3 $96,000 2.7% -1.3%
Tokyo 4 $84,500 3.70% 3.50%
Amsterdam 5 $62,800 16.00% 11.30%
San Francisco 6 $62,700 -0.10% -0.10%
Dubai 7 $62,300 -8.10% -8.00%
Dublin 8 $59,900 9.40% 5.00%
Paris 9 $58,100 4.60% 0.40%
Beijing 10 $54,900 -0.20% -5.50%
Los Angeles 11 $54,300 0.90% 0.90%
Sydney 12 $51,600 2.40% 4.20%
Singapore 13 $51,200 2.40% -0.10%
Brussels 14 $50,200 6.60% 2.30%
Shanghai 15 $49,300 11.20% 5.30%
Shenzhen 16 $48,700 20.90% 14.40%
Miami 17 $47,000 2.00% 2.00%
Stockholm 18 $45,500 9.30% 9.70%
Moscow 19 $44,000 1.90% 1.90%
Chicago 20 $43,800 -0.80% -0.80%
Madrid 21 $40,600 13.70% 9.10%
Frankfurt 22 $38,400 10.20% 5.70%
Berlin 23 $32,100 13.00% -8.50%
Mumbai 24 $30,900 -3.60% 1.60%
Nanjing 25 $30,100 14.90% 8.70%
Hangzhou 26 $29,400 1.40% -4.10%
Guangzhou 27 $23,800 9.10% 3.30%
Johannesburg 28 $23,400 0.10% 4.20%
Wuhan 29 $22,500 8.70% -2.90%
Chengdu 30 $19,900 7.20% 1.40%
Chongqing 31 $16,700 8.00% 2.20%
Tianjin 32 $16,100 22.00% 15.50%
Rio de Janeiro 33 $14,400 -20.20% -9.50%

Source: Savills World Research

*Savills uses a core business unit measure, the Savills Executive Unit - a 7-person strong staff team representative of a startup business, designed to be a comparable measure across all cities. For the Live/Work index we have measured costs for two teams, one based in a prime financial sector location, the other in a secondary/creative location to give a representative cross city costing. The Savills Live/Work index measures the annual per person cost of renting and occupying home and office space per employee (and their households) in key world cities, taking an average across the Savills Executive Unit.


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