Dubai topped the list of the most expensive cities in the Middle East for foreign expatriates, according to Mercer’s 2024 survey. Cairo was among the cities that recorded the highest increases in living costs globally between 2023 and 2024, alongside Accra, Addis Ababa, Tirana, and Istanbul. Mercer indicated that inflation is likely the primary reason for all increases except in Tirana, where exchange rate fluctuations are the main cause for the change in living costs. Living and housing expenses in Dubai are the highest in the Middle East for expatriate employees.
Globally, the company stated that based on cost of living data it prepared, Hong Kong, Singapore, and Zurich are currently the most expensive cities for international workers, maintaining the same rankings as last year in Mercer's assessments. Conversely, the cities with the lowest living costs are Islamabad, Lagos, and Abuja.
For the Middle East, Mercer noted that Dubai jumped in the global ranking to become the most expensive city for international employees, ranking 15th worldwide, three spots higher than in 2023. The next most expensive city in the region is Tel Aviv, which fell eight positions to rank 16th, followed by Abu Dhabi (43), Riyadh (90), and Jeddah (97).
Globally, Mercer reported that the ten most expensive cities ranked from 1 to 10 are Hong Kong, Singapore, Zurich, Geneva, Basel, Bern, New York City, London, Nassau, and Los Angeles. The ten least expensive cities ranked from 217 to 226 are Havana, Windhoek, Durban, Dushanbe, Blantyre, Karachi, Bishkek, Islamabad, Lagos, and Abuja.
According to Mercer, the ranking includes 2,261 cities worldwide, ordered from the most expensive places to live to the cheapest, serving as a valuable compass to explain the complex landscape of living expenses in cities around the globe. Mercer highlighted that several key factors have affected the global economy in recent years and will continue to impact the cost of living in major cities in 2024. The company noted that fluctuations in inflation and exchange rates directly affect the wages and savings of expatriate workers, with increasing economic and geopolitical volatility, as well as local conflicts and emergencies, leading to additional expenses in areas like housing, utilities, local taxes, and education.
With ongoing inflationary pressures worldwide, the company emphasized the importance of closely examining how the cost of selected goods has evolved since last year. To do this, Mercer analyzed the cost of a basket of everyday items, which included 12 large eggs, 1 liter of olive oil, espresso coffee in a local café, 1 liter of gasoline (95 octane unleaded), men's blue jeans, women's shampoo, and a haircut and styling. It was explained that on average, the costs of all these products rose, with the most notable increase in olive oil prices. Some cities saw steeper price increases for this commodity than others; for example, Buenos Aires experienced a 694% increase, while Istanbul saw a 145% rise.
The company observed that housing costs are a key factor in the city’s cost of living ranking, noting that one of the contributing factors to housing cost is the shortage of housing compared to the number of people looking for accommodation. It mentioned that between 2023 and 2024, there were significant fluctuations in these costs worldwide, with rental prices varying greatly between cities. For instance, Istanbul witnessed an average price increase of 301%, while Tel Aviv saw a decrease of 22%, and Minsk in Belarus had a decrease of 10%. Ankara, another Turkish city, experienced substantial rental price increases of 141%. Dubai saw a 21% increase in housing prices, while New Delhi experienced a 13% rise, with the same average increase noted in Miami, Florida, according to the company.
