RIO DE JANEIRO, BRAZIL – To better understand the prices of luxury items around the world, the Julius Baer Group, a Swiss bank, conducts an annual survey examining in detail how much it costs to live luxuriously in several cities on the planet.
Called the Global Wealth and Lifestyle Report 2020, the study compared the prices of 28 of the world’s most important cities in five different categories, which expand to 20 sub-categories.
The study categories are divided into “Home”, “Experience”, “Fashion”, “Family” and “Wellness”, with sub-categories encompassing various luxury items and services.
Of the 28 cities included in the study, ten are Asian, 12 are in EMEA (Europe, Middle East, and Africa) and six are located in America.
In the overall ranking, Hong Kong was the city recording the highest cost of living in the world. But when looking at each category separately, there is a clearer view of each city’s prices.
Rio de Janeiro: the only Brazilian city
According to the study, Rio de Janeiro proved to be an affordable city to buy property and services, but high taxes keep foreign millionaires away from Brazil.
The city’s main residential real estate market is accessible, with no indication of becoming more expensive in the near future. Rio de Janeiro’s most expensive neighborhoods are Leblon, Ipanema, and Gávea.
“Rio, often dubbed Brazil’s Manhattan, is the most expensive city for casual luxury buyers, with watches, bags, jewelry, whiskey and wine topping our global index. High prices are due to taxes of up to 300 percent on high-value items,” the report explains.
On the other hand, money can be saved on luxury hotel suites and wedding banquets, as the city appears among those with the lowest prices for both services.
However, the survey makes a caveat about Brazil in recent years, yet shows optimism for the future of the country and Rio de Janeiro.
“The demand for housing and the growth of prices in real terms have been lukewarm in recent years, due to an anemic economy, political uncertainty, and high interest rates”.
“Despite a welfare reform favorable to business in 2019, markets remain very cautious about the growth prospects for Brazil in 2020. A delay in fiscal reform restricts government actions amid lack of growth, low wages, and low investment,” the report concludes.
“Home”
The “Home” category involves luxury items such as sports cars and pianos, in addition to accounting for the price of the property itself.
According to the study, the city with the most expensive residence on the list is Monaco, the capital of the sovereign city-state that bears the same name. The cities of Hong Kong and London rank second and third, respectively.
As the survey data show, a square meter of one of the three most expensive apartments in the city of Monaco costs US$89,000. In Hong Kong – following the same specifications – the square meter costs US$57,000. In London, the figure is US$46,000.
At the opposite end of the list, the city of Johannesburg, in South Africa, recorded the cheapest square meter, with an average cost of US$3.400. Rio de Janeiro, the only Brazilian city in the ranking, ranked 25th, with an average price of US$6.300 per square meter.
The car used as a luxury model to perform the study standard was the BMW hybrid series 7. The Asian cities of Singapore, Shanghai and Hong Kong are the most expensive in the world to buy a luxury car.
According to the study, this is the result of high tax rates. For instance, China levies import duties, value-added tax, and a consumption tax depending on the car’s engine power.
In fact, four of the five most expensive cities are located in Asia. The exception is Istanbul, which ranks fourth. According to the report, a BMW 7 series costs some US$371,000. In Shanghai and Hong Kong, the model costs US$289,000 and US$236,000, respectively.
The city of Rio de Janeiro ranks sixth, with the car costing US$205,000. According to the study, as in Asian markets, the high price of the model in Brazil is a direct reflection of high import taxes.
The city of Vancouver, Canada, has the cheapest imported car. For US$93,000 it is possible to buy a hybrid BMW 7 series – less than half the amount needed to compare the vehicle in Rio de Janeiro.
First-class flights
In order to establish a fair comparison in the prices of first-class airfares, the study set as standard a round-trip ticket from London or New York to the city in question.
According to the study, in addition to excessive taxation, regulatory bodies in domestic air markets can directly affect competition in this market and therefore increase prices.
In the ranking, the city of Sydney, Australia, recorded the highest price, with a first-class ticket going for US$5,635. The Australian city is followed by Miami, in the USA, where the ticket to London can cost around US$5,611.
At the other end of the list, the city of Istanbul, Turkey, recorded the lowest price for the first-class ticket. The ticket comes for US$2,500.
Rio de Janeiro ranks tenth, with an average price of US$4,200.
Luxury Hotels
In the item of luxury hotels, a daily rate in a five-star hotel of the Marriott International group is considered.
In the ranking, the most expensive daily rate was found in Tokyo, Japan. In the Japanese capital, a room at a five-star hotel stands at US$1,594. The city is followed by New York, where the stay costs US$1,551 and Los Angeles, with the daily rate going from US$1,070.
Rio de Janeiro ranks 25th, ahead of Frankfurt, Germany, Sydney, Australia and Bangkok, Thailand. A stay at a five-star hotel in the Marvelous City costs about US$450.
Restaurants and fine dining
Eating in a renowned restaurant and experiencing a refined dinner can be the main course of a trip.
“A great dinner combines culinary skills with creativity and every now and then a touch of glamour. The best chefs are renowned for their dishes, even if the food is very expensive and the restaurants have long waiting lists,” the report says.
The study considers the main dishes and more orders from restaurants that have two stars in the Michelin Guide, one of the most respected gastronomic guides in the world, or restaurants that are among the top 50 on the San Pellegrino magazine’s list.
Reinforcing the stereotype of the French luxury restaurant, the city of Paris presented the most expensive price for a dinner. In the capital of France, a refined dinner comes out at around US$331 per person.
At the opposite end, the city of Vancouver, Canada, offers the cheapest fancy dinner on the list. With about US$83, it is possible to have a nice meal.
Jewelry
As a standard item to compare jewelry prices, the report chose Cartier’s Love Bracelet. According to the study, cities located in emerging markets tend to have higher prices for this type of luxury item.
“In the vast majority of cases, the disparity in prices between markets is due to local rates. In Rio de Janeiro, for instance, taxes on jewelry can be as much as double as in countries in Europe or North America,” says a text in the report.
Rio de Janeiro showed the highest value for jewelry. Cartier’s Love Bracelet could reach US$54,000. The second-highest price was found in Manila, Philippines, where the piece can cost US$52,000. In Moscow, Russia, the jewel can be found for US$48,000.
The cheapest jewel was found in the Asian market. In Hong Kong, the item costs US$42,228. According to the report, the global jewelry market moves around US$13 billion per year and is expected to grow at an annual rate of 3.5 percent between 2019 and 2023.
Luxury watches
The latest Fashion item is luxury watches. As a standard model, the report chose a Rolex Day-Date II.
Rio de Janeiro appears as the market where the watch model is the most expensive. In Rio de Janeiro, the item costs US$47,000. In Bangkok, the second most expensive city, the model costs US$40,000.
At the opposite end of the table is Sydney, Australia, where the watch costs US$30,000.
“The trend to experiment and experience luxury to the full has also reached the watch industry, with some brands aiming to open exclusive clubs to create long-term relationships with customers,” says the report.
“Family”
The family category is that which involves the expenses with the academic development and unique commemorative dates, like a wedding party. In addition, the study also listed expenses with lawyers.
Education
According to the report, the team was unable to find a proportional way to compare the prices of private boarding schools and colleges between countries. It only analyzed prices of one of the most expensive and traditional boarding schools in Europe, Eton College, founded in the 13th century in the United Kingdom.
Analyzing boarding school fees for boys, the study found that in the past 25 years the school fees have risen 550 percent. In 2019, tuition cost between 40,000 and 60,000 pounds to maintain a student enrolled in boarding school.
“The increase exceeded – by a lot – inflation, year by year. This price increase was partly influenced by a strong international interest in the school, particularly from emerging countries in Asia,” the report says.
Another reason the study showed no comparison between cities was the cost of getting an MBA at a leading college. The report only used prices and costs of the program at Harvard University in the US and Oxford in the UK as a basis. According to the study, costs at these universities amount to US$108,000.
“One trend that was clear in this year’s report is that private schools have considerably increased tuition fees while investing heavily in better facilities and technology, creating increasingly complete and elite learning environments,” the report says.
“You can see that several British and American schools are creating international branches on all continents to meet the international demand for education,” the report concludes.
Attorneys
In order to compare the prices of legal assistance between the cities analyzed, the report compared the price of consultation to set up a will.
As the study shows, large financial centers have saltier prices. The city of Hong Kong had the highest prices for consulting an attorney. In the Asian city, the consultation amounts to US$1,050. In Shanghai, the same service costs US$980.
New York City and London are next. In the American city, the price is US$945, while in the English capital the cost of legal consultation is US$936.
Rio de Janeiro ranked 22nd, with the service costing US$525. With a price of US$390, the cheapest city to set up your will is Manila, in the Philippines.
Botox
For the application of botox to remove wrinkles, European cities are the most expensive in the ranking. The city of Milan has the highest cost for the service, at around US$445.
Paris ranked second, where the service costs US$390. According to the report, this year the service showed a price increase in virtually all cities analyzed.
“The higher prices follow a growing trend of increased demand for so-called medical tourism,” the report says.
Rio de Janeiro was mid-way on the list, with a service not as expensive but far from affordable. The price of the operation in the Marvelous City was US$225. According to the study, Brazil is the country performing the highest number of plastic surgery operations per capita in the world – though it is not the cheapest.
The lowest price for the service was found in the city of Istanbul, Turkey, where the service costs US$79. For the European market, the Turkish city is recognized for its aesthetic treatments.
“Approximately 700,000 tourists visit the city each year to perform surgical operations, making Istanbul the largest center of its kind in Europe,” the report explains.
Surgical operations to the eyes
Laser surgery is used to correct vision problems such as myopia and astigmatism. It is considered a very safe procedure, but with salty prices.
In the city of London, the most expensive to perform the operation, the service costs US$6,000. New York is the second city with the highest price for correction. Anyone performing the operation in the Big Apple will need to disburse US$5,400.
Rio de Janeiro is one of the cheapest cities in which to perform the laser surgery. Around here, the operation costs US$1,860. But the city with the lowest price for the service is Moscow, in Russia. There, the surgery costs US$763.