Foreign Exchange

How to afford the world's most expensive cities

Words: Lee Tulloch

It probably doesn’t come as a surprise to any of us, but when a website for international expats recently named the world’s most expensive cities to live in, six of Australia’s cities, Sydney, Brisbane, Melbourne, Perth, Adelaide and Canberra (in that order), made it into the top 26.

That has been bad news for Australian tourism. Combined with our competitive Australian dollar, the expense of a vacation in this country has seen Australians holidaying abroad in greater numbers than ever. But for travelling Australians it has been a bonanza.

Even London seemed a relative bargain earlier in 2013 when our dollar was close in value to 70 percent of the pound. When I was in Italy in June a dollar was worth about 80 euro cents. Now, with the Australian dollar wobbling, Europe is not seeming so affordable any more, although it’s still a far cry from the days when the Aussie was the ‘Pacific peso’.

I recall visiting Tokyo about twenty years ago when it was so unaffordable, even a simple (highly polished) apple was out of reach. I was travelling alone and my hotel recommended a small restaurant that would be suitable for solo female travellers. It was the kind of place that didn’t have prices so, in line with my miniscule budget, I ordered soup and a couple of grilled prawns. The bill came to $80. By contrast, nowadays Japan is quite a bargain.

Similarly, travelling alone in London in the 1980s, on assignment for a magazine that never accounted for the fact that its staff needed to eat, I’d demolish a huge breakfast in my hotel, which was included in the room rate, and drop into the Ritz to gorge myself on its £4 afternoon tea. (Yes, that was a while ago – these days, champagne tea at the Ritz will set you back £60.) I’d live on cakes in Vienna; baguettes and salty butter in Paris. Unhealthy, perhaps, but when you were saving all your money for museums and theatre excursions, food wasn’t so important.

I’d live on cakes in Vienna; baguettes and salty butter in Paris. Unhealthy, perhaps.

Some of the world’s most wonderful destinations, such as India, China, Cambodia, Sri Lanka and some South American countries, are also the least expensive when you’re carrying Australian dollars, and so are countries such as Turkey that haven’t adopted the euro.

But when a villa in Italy beckons or a Norwegian cruise, only the luckiest of us don’t need to do the sums. If you have to spend any time in Oslo, for instance, which regularly tops the list of world’s most expensive cities, you might need to make sure that the cruise that gets you there is all-inclusive, you have self-catering accommodation, or eat most of your meals at markets. I met a well-heeled traveller recently who was shocked to find that casual lunch for two without wine in the Norwegian capital cost him about $250.

So many of us are travelling for culinary experiences now that eating out is a big factor in terms of cost. Blowing hundreds of dollars on a once-in-a-lifetime meal at a famous Basque restaurant might seem good value in terms of life experience but spending the amount of a quarterly electricity bill on an ordinary meal in an ordinary café in Copenhagen just plain hurts. If you’re toting children, expensive cities are particularly painful.

Many find a way around the expense of big cities in the ‘sharing economy’, especially self-catering options like Airbnb. Recently, I helped a friend with some advice when she was trying to find accommodation in Paris. I was impressed by the great selection of apartments she uncovered through some of the online apartment rental groups. These options give a local experience at the fraction of the cost of the five-star hotels, although in some cities like New York short-term rentals like Airbnb are, strictly speaking, illegal, because, unlike hotels, they pay no taxes. Expect some disruptions this year.

Last year, I visited Stockholm and Copenhagen and, apart from being beautiful cities, they made me very happy. Why? Because I’d finally found somewhere more expensive than Sydney/Melbourne/Brisbane/Perth! I was perversely relieved to find I didn’t live in the most overpriced city in the world.

These brief few years when the whole world seemed cheaper than Australia may be drawing to a close, but never fear, the options for Luxe Nomads to travel five-star on a three-star budget are more numerous than ever, thanks to the big bargain basement that is the internet.



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