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Spacer ImageLow Cost of Living: Cities within the US  Dotted Divider  Cities Outside of the US
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Cities Outside of the US

Where in the world are the least expensive large cities to live in?

The large cities outside the US with the lowest cost of living for low income families are all in the developing world, as you might expect.  They are Asuncion in Paraguay, Harare in Zimbabwe, Buenos Aires in Argentina, Manila in the Philippines, and Karachi in Pakistan.  Living in Asuncion, which is the cheapest of all the major cities included in the statistics, is less than half as expensive as living in New York.  Generally speaking, the cheapest cities to live in are in south Asia and South America, and the most expensive are in Europe and the Far East, but within countries there can be a wide fluctuation – the cost of living for low income families is much lower in Leipzig, Germany, than it is in Frankfurt.

How is the low cost of living measured?

The survey is carried out by a company called Mercer Human Resource Consulting, and covers 144 cities across six continents and measures the comparative cost of over 200 items in each location, including housing, transport, food, clothing, household goods, and entertainment.  It is the world’s most comprehensive cost of living survey, and is used to help multinational companies and governments determine compensation allowances for their expatriate employees.  They are based on prices in US Dollars, which means that as currencies rise and fall, a city’s cost of living may be deemed to change, even though the prices in that country’s currency have remained stable.

What are the top 5 least expensive cities to live in?

Karachi, Pakistan.  Karachi was the original capital of Pakistan, and although that is now Islamabad, Karachi remains the cultural and economic center of the country.  It’s one of the largest cities in the world with some 12 million residents.  It is also the financial capital of Pakistan and attracts a lot of investment into IT, software outsourcing, and call centers for foreign companies.  However, despite the low cost of living for low income families, pollution and crime are significant problems, so many consider Karachi to be one of the world’s least livable cities.

Manila, the Philippines.  Manila is another one of the world’s largest cities, and as with Karachi, it faces significant challenges in terms of pollution, crime, and poverty.  However, there are some delightful low crime, low cost of living areas in and around Manila where foreign residents can enjoy an extremely good standard of living.  The cost of basic goods and necessities in Manila is extremely low, although services sometimes leave something to be desired.

Buenos Aires, Argentina.  Buenos Aires is one of South America’s most vibrant and enjoyable cities, and the standard of living enjoyed by foreign residents and employees of foreign companies is second to none.  It’s the financial, cultural, and economic hub of Argentina, and enjoys a temperate climate, good infrastructure, and some of the best food, drink, and entertainment to be found anywhere in South America.  Its low cost of living makes it an excellent city in which to live.

Harare, Zimbabwe.  Harare, formerly known as Salisbury, is much smaller than some of the other cities on this list, with a population of just under 3 million in the greater metropolitan area.  It’s the economic and trade center of Zimbabwe and the wider region.  The low cost of living comes at a price, though.  The country is in the midst of significant turmoil and, although foreign residents are still welcomed, basic services are not as good as they should be.

Asuncion, Paraguay.  The cheapest city of the 144 in the annual survey, it is also one of the smallest.  The capital of Paraguay, it is an old colonial city that retains much of its original charm.  Commerce and service industries are the major employers in Asuncion, and the relative absence of large numbers of foreign residents is one of the reasons for the low cost of living, which makes it an attractive place to base a family.

Where can you find more information?

You can find the complete list of 144 cities here (http://www.finfacts.com/costofliving2006.htm), and further information on the website of Mercer Human Resource Consulting here (http://www.mercerhr.com/costofliving).  Using these websites and the information therein, you can get a good idea of the relative costs of various goods, property, and services compared to the country in which you are currently based.  However, for more detail on where you can find low crime, low cost of living areas, you will need to do further research – look at local websites and newspaper sites to get some idea of prices, the cost of renting or purchasing apartments in the city center, the price of basic commodities, and so on.  Bear in mind that fluctuations in currencies can have a big effect on the cost of living, particularly if you will be paid in a foreign currency such as US Dollars.


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