Revealed: London ‘becoming cheaper place in which to live and work’ – but only if you move from abroad

It is getting cheaper to live and work in London, according to a new survey – but only if you move to the capital from abroad.

London has plummeted 13 places down the rankings on Mercer’s annual Cost of Living survey to 30th in the world.

The study, which measures how expensive 209 world cities are to live in for ex-pats, puts the capital’s cheaper living down to a decline in the pound.

And the study shows it is only the high cost of renting a property which has stopped London slipping further down the list.

According to the report, renting a two-bedroom flat still sets ex-pats back an average of £3,200 a month, putting London at the high end of the international scale.

But the cost of milk, a loaf of bread or a small bottle of beer, were all far cheaper than comparable global cities, the survey showed.

Kate Fitzpatrick from the firm said: “UK cities have fallen again this year as the British Pound weakened before, and after, the EU referendum last summer.

1. Luanda

2. Hong Kong

3. Tokyo

4. Zurich

5. Singapore

6. Seoul

7. Geneva

8. Shanghai

9. New York City

10. Bern

30. London

“Aberdeen saw the second biggest drop in the overall global rankings, only behind Cairo, due to a significant softening in the housing market as a result of the slow-down in the energy sector.

“However, London did not drop as far as may be expected, with steep prices keeping London as one of the most expensive cities for expatriates worldwide.

“The capital’s rental costs remain at the higher end globally and have remained stable, or increased slightly over the last year as construction cannot keep up with demand.”

The survey puts Luanda in Angola as the world’s most expensive place to live, just above Hong Kong and Tokyo. Tunis in Tunisia is ranked the cheapest of those surveyed.

Mercer’s focus is on helping companies deploy employees to countries around the world with its index looking at everything from the cost of a fizzy drink to the price of a flat.

And Michael Grover from the firm said, although it makes the city a good place to do business, typical Londoners would not be seeing noticeably cheaper living.

He explained: “You could argue London is becoming a cheaper place to do business for companies from overseas paying locals UK salaries.

“But, for Londoners, a UK salary is no longer as attractive as it once was.”

Alongside London, other European cities have also fallen, including Vienna, Rome and major German cities like Munich and Frankfurt.

Mercer’s says that change has similarly been driven by a weakening of the Euro against the dollar.

Despite the firm’s warnings about London’s rental sector, recent figures have shown the cost of renting in the capital has actually fallen.

A index showed rents in much of London had fallen by an average of one per cent in May compared to the previous year.

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