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ZURICH

Why Zurich ranks as the world’s most expensive city once again

A new study places Switzerland’s largest city on top in a global league table based on how pricey a city is based on prices for goods and services.

Published: 18 November 2020 13:47 CET
Why Zurich ranks as the world’s most expensive city once again
Zurich's is the world's most expensive city. Photo by AFP

The Economist magazine Intelligence Unit’s Worldwide Cost of Living (WCOL) index, reports the prices of 138 goods and services in about 130 major cities in September 2020.

Zurich, Paris, and Hong Kong share the number 1 spot , followed by Singapore, Tel-Aviv and Osaka.

The report indicated that the Covid-19 pandemic has changed the cost of living in 133 cities around the world since the start of 2020. 

“Of the ten categories covered by this report, tobacco and recreation (including consumer electronics) have seen the biggest price increases since last year, while clothing prices have seen the steepest decline”, the Economist noted.

Prices went up primarily due to currency volatility, supply chain problems, the impact of taxes and subsidies, and shifts in consumer preferences during the health crisis.

Even before the Economist report was published on Wednesday, and regardless of the pandemic, Zurich has been ranking as, or among, world’s most expensive cities. 

READ MORE: Why going on a date is so expensive in Zurich?

For instance, in its Price and Earnings rankings for 2018 — the last year for which statistics have been collected — UBS bank listed Zurich as having most expensive goods and services among 77 surveyed cities.

UBS assigned New York a value of 100, with all other cities measured against that baseline. Zurich scored 116.8 before rent was factored in, meaning it was 16.8 percent more expensive than New York overall. After rent was factored in, Zurich’s score was still a high 104.3.

So what are the average prices in Zurich for basic goods and services?

These calculations were done by ETH, a public research university in Zurich, and covers average monthly expenses for a single person. The actual living costs will depend on each individual’ living situation, the costs of health insurance, and personal lifestyle.

Monthly expenses for a single person

Fixed costs Amount in CHF
Accommodation (room CHF 400-​1,000, flat CHF 800-​1,600) 800
Health insurance 300
Household contents/personal liability insurance 30
Telephone connection/Internet/TV and radio licence fees 120
Energy (electricity/gas) 40
Public transport 100
Food, household items, personal expenses Amount in CHF
Food 400
Clothes, shoes, hairdressing, mobile phone, leisure activities 250
Washing, cleaning and personal hygiene items, waste disposal 30
Provisions Amount in CHF
Medical treatment (dentist, doctor, optician, medication), gifts, repairs, small purchases 180
   
Total amount in CHF 2,250

The total of 2,250 francs would have to be multiplied if more than one person lives in a household, as the cost of health insurance and rent for a bigger apartment would increase.

As an indication, rent for a 4-room flat outside the city centre costs 2,535 francs, while the same size accommodation in the centre is 3,600.

Readers verdict: The best and worst things about life in Zurich

You can see the average prices for goods and services in Zurich in November 2020 here.

Now, let’s not forget that salaries in Zurich are among the highest in Switzerland and the world.

The wages depend on a variety of factors, including indutstry, position in a company, and education level.

However, average monthly net salary is around 6,440 francs.

How does this translate into purchasing power — that is, the ability to buy products and services based on net salary? 

According to the same UBS study, in terms of purchasing power Zurich ranks second in the world. 

So what is expensive to buy in Zurich?

As everywhere in Switzerland, groceries, rent, clothing, restaurants, entertainment, public transportation, and health insurance take the biggest chunk out of a household budget.

On the other hand, electronics and education are less costly than in many other countries. Taxes are lower as well.

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For members

ENERGY

EXPLAINED: How high will heating bills be this winter in Germany?

The cost of energy is expected to rise again this coming winter, even though the government's price cap is supposed to be in effect until April 2024. Here's what households can expect.

Published: 31 October 2023 10:31 CET
Updated: 5 November 2023 22:45 CET
EXPLAINED: How high will heating bills be this winter in Germany?

The onset of winter will raise concerns for many in Germany about the cost of heating their homes, with memories of last year’s rocketing prices and concerns over domestic gas supply resurfacing. 

But, compared to last year, the energy prices have now largely stabilised, though they are still higher than in 2021.

The stabilisation in prices is partly thanks to the government’s energy price cap which came into force earlier this year to cushion the blow of soaring energy prices by capping electricity costs at 40 cents per kilowatt-hour and natural gas at 12 cents.

READ ALSO: Germany looks to extend energy price cap until April 2024

The federal government plans to maintain this cap until the end of April, though this could be extended even longer, if necessary. 

How high are heating costs expected to go this year?

For the current year, experts from co2online expect somewhat lower heating costs than last year.

Heating with gas, for example, is expected to be 11 percent cheaper in 2023 than in 2022, costing €1,310 per year for a flat of 70 square metres. 

The cost of heating with wood pellets will drop by 17 percent to €870 per year, and heating with heating oil will cost 19 percent less and amount to €1,130.

According to co2online, the costs for heating with a heat pump will drop the most – by 20 percent to €1,1105. The reason for this, according to co2online, is a wider range of heat pump electricity tariffs.

Tax hikes in January

Starting January next year, the government will raise the value-added tax on natural gas from seven to nineteen percent.

Alongside this, the CO2 price, applicable when refuelling and heating, will also increase.

According to energy expert Thomas Engelke from the Federal Consumer Association, these increases will mean that a small single-family household with three or four people that heats with gas would then pay about €240 more per year for gas.

“That’s a lot”, he said. 

Another additional cost factor to consider is that network operators also want to raise prices. However, the federal government plans to allocate €5.5 billion to cushion this increase for consumers as much as possible, so how such cost increases will ultimately affect consumers is currently hard to estimate.

READ ALSO: Why people in Germany are being advised to switch energy suppliers

Overall, it can be said that, from January, consumers will have to brace themselves for higher energy costs, even though massive increases are currently not expected.

Consumer advocate Engelke advised customers to closely examine where potential savings could be made this upcoming winter: “Those who are now signing a new gas or electricity contract should inform themselves and possibly switch. Currently, you can save a few hundred euros. It’s worth it. On the other hand, you should also try to save as much energy as possible this winter.”

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