Jerusalem and Tel Aviv ranked higher than New York City in cost of living, a recently published report from human resources consulting firm ECA international says.
The report ranks cities continentally and worldwide based on information they summarized from cost of living surveys and data throughout 2011.
Tel Aviv came in 32nd place, way ahead of New York City, which ranked 46th overall. Jerusalem, which according to the Israeli Central Bureau of Statistics received a grade of 4 out of 10 in terms of socio-economic status, ranked 39th in the ECA report, down from 21st place last year.
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The report noted that last year, Tel Aviv was ranked even higher, at number 18. According to estimates, the descent to 32 is mostly due to the entry of other, more expensive cities to the list, not a result of prices in the city becoming any cheaper. Overall, locations across the Middle East have fallen in the ranking. Israeli locations are by far the most expensive locations for expatriates in the region. In contrast, Dubai is ranked 180th while Jeddah, in 232nd position, is the least costly location surveyed in the region.
Why is Tel Aviv so expensive? The rating that the ECA carries out, the details of which are released to news agencies and real-estate websites around the world, mostly take into account the cost of local food and overall sustenance expenses. The poll does not take into account expenses for basic infrastructure services such as electricity, water and gas. With respect to these services, Israel ranks relatively low in the world for their cost.
The top of the list was occupied by Japanese cities. Tokyo took first place for the second year in a row as the most expensive city in the world. This is on account of the dramatic strengthening of the yen, the Japanese currency, following the earthquake in Fukoshima and the economic crisis in Europe. Three other Japanese cities were ranked in the top ten of the ECA list.
The most expensive European city is Oslo, which ranked second on the worldwide list of cities. Globally, the Norwegian capital has risen from sixth to second place. Third place in the world went to Geneva, the international Swiss city that hosts many U.N. institutions. Geneva became more expensive this past year due to a dramatic hike in the strength of the Swiss Franc.
Despite much turmoil in the eurozone, the euro has strengthened on average against other major currencies over the last year. As a result, locations in the zone have risen in the ranking, while those in the U.S., for example, and in locations where the currency is pegged to the U.S. dollar, such as Hong Kong, have typically fallen.
Within Europe, Turkish locations have fallen furthest in the ranking. The capital Ankara fell 99 places between surveys, a result of a much weakened Turkish lira against major currencies.
Vancouver, placed 43rd globally, is the most costly location in North America. New York's Manhattan is in 46th position, down from last year's 28th place. Locations across the U.S. have seen some of the biggest falls in the global ranking, largely due to the depreciation of the U.S. dollar against many major currencies.
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