Big Ticket Tokyo?
Image Credit: Jack French

Big Ticket Tokyo?


Judging from a report by ECA International naming the 50 most expensive cities in the world in 2010, that’s recently gotten major publicity thanks to an article last week by Business Week, Japan is a ridiculously expensive country to live in.

Not only has Tokyo taken the top spot on the list (for the first time since 2005)—three other Japanese metropolises have made the top ten, including the respective port cities of Nagoya, Yokohama and Kobe.

No other Asian countries even made the top 10, while Seoul came in at number 20—a surprise for the South Korean capital considering it ranked 102 in 2009.

However, today I spoke to an Asia-based owner of several publishing ventures in the region, including Tokyo, about this and he had some fairly scathing remarks on some of the data selected by both the ECA report and Business Week.

He pointed out, for example, how the set of ‘average’ Tokyo prices presented in the Business Week piece, including things like an $18 lunch, represents the lifestyles of only a very tiny sliver of the city’s population.

First, it’s limited to the category of expat residents in Tokyo. Of those, the number actually paying these prices is most likely an even smaller fraction of the people who choose to have ‘Western apartments in expensive districts, steak lunches, tropical fruit, foreign beer, coffee in hotel lobby lounges and who shop at international supermarkets.’ He went on to suggest that the expats or visitors who opt to adapt a little more to Japanese culture will have a much different and significantly cheaper experience, citing the example that ‘a very filling, tasty and healthy lunch can be had for half as much as $18.’

Image Credit: jamesjustin/flickr

Image Credit: jamesjustin/flickr

He also pointed out that having himself spent significant periods in both Tokyo and Sydney in recent years, ‘setting aside the significant AUD-yen exchange rate fluctuations over the last ten years—I see no appreciable difference in the cost of living, with one exception:  fruit really is ridiculously priced in Tokyo.’

Meanwhile, I also spoke to Australia-based design aficionado and author of several Japan guidebooks, Gordon Kanki-Knight, who concurred, attesting that ‘what most people say about Tokyo is that it’s a cheaper city than most big cities. Live like a Tokyoite and Tokyo is cheap. Rent is cheaper than London, public transport is cheaper than London and just as cheap as New York, there’s no tipping in bars and restaurants and no inflation—which means bank loans are more affordable.’

Lindsay van Niekerk
July 5, 2010 at 12:25

I agree. Have had two holidays in Tokyo and enjoyed a very comfortable serviced apartment, brilliant service, cheap train travel (except for bullet train which is expensive), amazingly cheap food everywhere, clothing prices comparable or better than Australia but with vastly superior quality. Okay, so I don’t pay rent or live in a tiny shoebox apartment or have to commute for an hour each day, but I am always mystified about Japan being so outrageously expensive.

July 4, 2010 at 08:24

I lived in Manhattan for 3 years and currently live in Tokyo (3 years and counting). I think this ECA data is really getting misinterpreted, even by the ECA press release link above.

The ECA report has little to do with the cost of living in different cities around the world. It’s purpose is to estimate the costs of putting an expat in a city who is not being paid in the local currency. This is not even remotely the same as living and being paid like a local. So has my salary magically increased simply because I’m paid in yen rather than the US dollar over the past three years? Reality is that the cost of living here has decreased. The prices quoted in the Business Week article are ridiculously high. I live in a very modern, 2 bedroom, high rise apartment (14th floor) with a beautiful view, 10 minute walk from Ginza, and pay the equivalent of 2000 dollars a month in rent. My daughter goes to a beautiful public day care, 3 minute walk from my apartment, with hot lunches provided and it costs me about $150 dollars a month. This same service would be way over $1200 per month in Manhattan. It is much cheaper to live here than Manhattan and far safer.

Part of the reason that it’s expensive for expats in Tokyo is that the local language is not English or any other widely spoken language, so they need more help then if they were in say London. Also, the US dollar has weakened considerably against the yen. This adds greatly to the THEIR cost of living but has nothing to do with the real cost of living for people who speak the language and are paid in local currency.

July 2, 2010 at 18:35

Hmmm… interesting. Thanks. I’ve definitely seen Norway on various sorts of these lists. I didn’t know about the unfortunate stats on suicide and drug-related death however – a shame. Tokyo also has some of the world’s highest suicide rates…which could in fact potentially be connected to its supposed expensiveness.

I think that lists and ratings are enticing for people, because they’re easy to digest and make it easy to form quick ideas. But I agree that using terms like ‘best’ is not fair or reliable, for as you said, it is such a subjective term and concept.

July 2, 2010 at 17:11

On a slightly related note, the annual “World’s Best Country to Live In” competition often ranks my country – Norway – first, second or third. Someone then tell my why we at the same time have amongst the world’s highest suicide rates and drug overdoses, two other lists they conveniently forget to mention.

If you ask me, the idea of ranking which country is “Best” is silly at best. Countries and cultures are extremely complicated (and individual) matters. What I’d like to see is a “which country is best for you”-wizard that presents your ideal country based on your preferences. Of course presented as a game and not a semi-official list, which is closer to what the real world is like.

July 1, 2010 at 16:16

Yes, and when it’s a widely distributed piece such as the BW one, the angle can misinform a lot of people. And I have to thank my informants as well, who are not Manhattan corporates (!), but successful professionals who have clearly had more authentic Japanese experiences than that reporter!

July 1, 2010 at 14:44

Thank you for writing this. Every time some global consultancy writes up a new report on how much it costs to send your corporate vice president to go live overseas without changing his Manhattan lifestyle at all it gets trumpeted as a representation of how actual human beings live. Would be nice if the press stopped reporting these numbers in this way!

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