Can I afford to live in a city like Paris?

New York is used as the index against which all other cities are measured as expensive or not in the 2017 Worldwide Cost of Living report issued by the Economist. It ranks 9th, to Paris’ ranking of 7th. Singapore is number one most expensive city to live in, but New York is the only North American city in the top 10 list. Paris is the only European city in the top 10.

The ten most expensive cities in the world:

City              WCOL index       Rank     
                    (New York=100)
            
Singapore           120                1         
Hong Kong          114                2         
Zurich                 113                3
Tokyo                  110                4
Osaka                  109                5
Seoul                   108                6
Geneva                107                7
Paris                    107                7
New York              100               9
Copenhagen         100                9

Source: The Economist Intelligence Unit

Geneva tied with Paris for 7th place, although while Paris is 7% more expensive than living in New York, it’s considerably less expensive than it was five years ago, when it was 50% pricier. New York fell to 9th place thanks to the weakening of the U.S. dollar, which also had effects on other U.S. cities, a very sharp decline considering it was in 46th place only five years ago.

In predicting what is to come, the report cites the election of Donald Trump which could create “signal significant upheaval in trade agreements and international relations, which may push up prices for imports and exports around the world as treaties unravel or come under scrutiny.”

While the report compares the price of a loaf of bread, a bottle of table wine, a pack of cigarettes and one liter of unleaded gas, I am skeptical that the picture it paints is very narrow in scope and doesn’t really answer the question you have: Can I afford to live in a city like Paris?

With Paris being among the top ten most expensive cities in the world, according to The Economist, I would have to argue this. Rather than comparing the cost of bread at mere pennies difference, what if we were to compare the cost of health care, education, insurance, rent, property value, transportation, taxes, etc.? Aren’t these the big costs that really matter?

When I was in a position to choose between staying in Paris and moving back to Los Angeles in 1997, I chose Paris. A big part of that decision was financial. To return to the U.S. meant needing to buy a car (virtually no public transportation), paying three times more for health insurance and sending my daughter to private school (unless I wanted to settle for a lower quality of education than she had in Paris for free). That’s a big chunk of change which wasn’t necessary living in Paris.

Retirees who move here are finding their pensions stretch a whole lot further, too. And the French government doesn’t tax their retirement income. Several of our clients who purchased a “pied-à-terre” here in Paris in the past 10 years have moved over and are living in their much smaller Paris apartments, but living a whole lot better lives, with a lot less expense and a lot more opportunity to travel and see France, Europe and the world on what’s left in their coffers.

If you are interested in taking your own survey — compare the costs of your current lifestyle with a new one in Paris or other city in France, let me be the first to help you analyze which you can better afford. Together we will determine the truth and the direction you really want to take to complete your “bucket list.”

A bientôt,

Adrian Leeds
The Adrian Leeds Group

 
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