10 Most Expensive Cities in the World

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London’s property market is still hell bent on going crazy as if it has overeaten and become over inflated yet again. British Land, the London-based property investment company that is centered on commercial property in the capital has just posted a staggering increase in the value of the property on its books, to the tune of 12.1% in 2014. Office and residential property increased by 18.8% also. The company has a pre-tax profit in 2014 of £31 million ($494.2 million), which is up on the previous year by 5.4%.

British Land owns the famous Leadenhall Building in London, otherwise known as the Cheesegrater. In 2014, it went beyond all expectations and broke new dizzy heights for rent. It managed to make an average of £90 (or $142) per square foot last year. British Land raked in $409 million just on the sale of 22 apartments in the center of London in 2014. That’s $19 million per flat on average.  There are new developments that are planned in London in the areas of Shoreditch and also in Surrey Quays and that means that a killing could be made yet again.  Of course, British Land doesn’t believe that the property bubble will come to an end and says: “The UK remained the real estate investment market of choice for overseas capital in search of yield. London continued to be the principal beneficiary, with demand driving yields down in both the City and West End.” But, as we all know, bubbles have a bad habit of busting and exploding in some people’s faces. They strongly believe that it will continue, however.

But, London is not the only place in the world for expensive property. Where would you think is the place where you would need the most when forking out for a place to live around the world? Here’s the list of the top-ten cities in terms of the cost of the property there.

The Knight Frank Wealth Report has just published the top 40 cities in the world which work out to be the most expensive for property prices in its Global Cities Survey. The place to invest for a great future for your kids, or the place definitely not to move to if you don’t want to be paying a huge percentage of your annual salary in rent or mortgage repayments? If you have the money though, these cities could be the places to invest in. Here are the top ten places (reverse order) if you have a spare million dollars laying around to get rid of somewhere in the world:

Top-Ten Cities

  1. Los Angeles, where it would take $1 million to get 57 square meters of property in the city center.
  1. Paris would set you back $1 million and get you just 50 square meters of some chic place to crash in.
  1. Shanghai is cheap at half the price apparently where that same $1 million would get you two square meters less than in Paris, at 48 square meters.
  1. Sydney is also the place to buy if you can live in 41 square meters for the same price.
  1. Geneva would see you getting property to the tune of 39 square meters per $1 million.
  1. Singapore would set you back $1 million and get you 39 square meters of luxury.
  1. New York would allow you to have 34 square meters for the same price.
  1. London would provide you with a measly 21 square meters for that same million.
  1. Hong Kong would get you just 20 square meters.
  1. Monaco is the most expensive place on the planet for property today and would get you just 17 square meters. If you can resign yourself to living in a small cupboard with the wife, the kids and probably at that price the domestic servants or hired help.

London will apparently remain the only city in Europe that will remain in the top cities in the world and the rest of them will suffer due to the rise in importance of Asia. There will still be a projected increase in European cities of 27% in terms of the world’s wealthiest people, but the figures will grow even faster in other cities in Asia, meaning Europe will be knocked off the top. The number of Ultra-High-Net-Worth Individuals will grow by 91% according to the survey in the next decade in Asia.

You would certainly have to be an Ultra-High-Net-Worth Individual to make it onto the property ladder in those cities.

UHNWIs

The greatest growth in cities with regard to Ultra-High-Net-Worth Individuals is in:

·         Singapore with an extra 1,752 UHNWIs.

·         Hong Kong notching up 1,251 more UHNWIs.

·         New York adding an extra 1,013 UHNWIs in the city.

But the top cities according to the report to attract UHNWIs are going to be in 2025:

·         New York

·         London

·         Hong Kong

·         Singapore

·         Shanghai

·         Beijing

·         Miami

·         Dubai

·         Paris

·         Zurich

But, what’s the state of ownership in the USA and how many people can actually afford to buy their own place these days? Who’s going to be heading for New York and London and how many people have the money to actually do so these days?

 

State of Property Ownership in the USA

According to government statistics regarding home ownership in the USA and the number of rentals; we can see the following regarding the USA today:

·         36% of the US populations rents property today.

·         That means some 42,357,512 households and some 107,573,870 people that are residents living in rented accommodation.

·         64% of the US population lives in owner-occupied accommodation.

·         That means some 73,933,462 households.
Or, 200,525,299 people that are resident in the country in property that they own.

·         People under the age of 30 make up 51% of those that are in rented accommodation today (more than 55 million people).

·         Those that are over the age of 65 make up just 8% of the rental accommodation (more than 8 million people).

It’s not surprising given the price of accommodation in some of the cities above in the list in the US that the under thirties are having trouble getting on to the property ladder, is it? While the big investment companies are gaining the benefits from the property bubble, then the younger ones will just have greater and greater difficulty in entering the property market and buying somewhere to live.

 

Where would you invest in the future in the property market? What city would get your attention?

Apparently, you might be surprised as they are not the cities that are attracting any attention right now from many people. The top cities to invest in right now would be those that are going to become major regional actors and not the ones that actually have the billionaires-buddy club already.

  1. Belgrade, Serbia: There is a projected forecast of a jump of 72% in terms of HNWIs (dollar millionaires) by 2024. There was only a growth of 12% from 2007 to 2014. But, this is set to rocket in the next ten years. The city has an attractive taxation policy that has managed to attract major world companies such as Fiat and Siemens and it makes up for 40% of the economic activity of the country already.

 

  1. Panama City, Panama: The number if HNWIs has doubled since 2007. There is a projected figure of 7,000 of them by 2024. The Economist called Panama City “the Singapore for Latin America” and it is economic stable and proficient today. Foreign direct investments stand at 9% of Gross Domestic Product.

 

  1. Addis Ababa, Ethiopia: This is the country with the fastest growing economy in Africa at the present time. It also has an expanding population, with the city seeing its population surge to more than 8 million people by 2040. There is a predicted figure of 2,600 HNWIs by 2024, which means the strongest percentage growth in the world.

 

  1. Yangon, Myanmar: Myanmar has a projected growth rate that is set to outstrip those of India and also of China in the coming decades. The city of Yangon accounts for 20% of the country’s economic output and the number of HNWIs is set to reach 3,500 by 2024.

 

Are these the places to buy accommodation in and start getting into investment-wise for property?