The least affordable city in the world for renters has been revealed, and it’s not where you might think.
Although Beijing’s monthly rent averages $789, the ordinary tenant cannot afford standard living as Beijing's rental costs generally exceed salaries, according to a study from UK-based Global Cities Business Alliance (GCBA).
Rental costs in the Chinese capital allegedly represent a whopping 123 per cent of the average worker’s salary. Having reviewed 15 cities around the world, GCBA found rents in Beijing took a strong lead and were almost twice as expensive as its closest competitor, Abu Dhabi.
Lesley Saville, CEO of the Global Cities Business Alliance said global cities such as Beijing need to readjust their strategies. "Big cities like Beijing are victims of their own success: rapid growth has magnetised workers, but they now need to deliver enough houses so that workers enjoy living there. Beijing is trying to address the problem with measures such as building new underground lines to unlock housing and by directly funding development, which will help," Saville said.
Figures: GCBA[/caption]City restrictions that mean non-residents cannot buy houses in Beijing until they have paid tax in the city for five years, making renting the only option for the many young adults and migrant workers that live there. Renting stands as the only viable option for most inhabitants as real estate prices have risen 18 per cent in the year to March 2016.
The group blamed high housing prices and a limited supply of available land for sale resulting in higher renting cost, according to the report. According to their website, the GCBA “provides a unique forum where business and city leaders come together to define, shape and implement initiatives for improving cities’ performance in the changing global economy.”
Out of the 15 cities in the study, San Francisco claimed the title for the most expensive average monthly rent topping $2,824 in 2015.