- Nestpick, the world’s largest database for furnished apartment rentals, provided data to Business Insider about the average monthly salary needed to afford a single-person apartment in major cities.
- Monaco and Hong Kong top the list, followed by New York and San Francisco.
- Across 50 major cities, residents need to earn between $US1,800 to $US13,800 a month to comfortably rent a single-person apartment.
There are many ways to determine the world’s priciest city.
Copenhagen is the most expensive city for a weekend getaway, Zurich is the most expensive place to buy a movie ticket, and London has the most expensive monthly transportation pass.
Many urban residents are willing to put up with these high costs of living in exchange for job opportunities, cultural amenities, diversity, and nightlife. But, in most cases, they will have to contend with steep costs of rent.
A new report from Nestpick, the world’s largest database for furnished apartment rentals, takes a look at the cost of renting an apartment in more than 700 neighbourhoods spanning 50 major cities. The cities were chosen based on Nestpick’s most common search results and the most popular locations for high-paying jobs.
Data given to Business Insider shows the average monthly salary needed to afford a single-person apartment – around 540 square feet – in each of these cities.
Before diving into the results, there are some ground rules to consider: The prices are based on median rents for the last quarter of 2018, so they should reflect the current listings for an apartment. Apartments are considered “affordable” if households are spending 30% or less of their income on rent – a standard used by the US government.
Based on these criteria, the least affordable city for a single-person apartment is Monaco, where residents must earn nearly $US13,800 a month to rent a small space.
That’s much higher than the $US10,000-plus monthly salary required to rent a single-person apartment in the runner-up city, Hong Kong. While steep prices in Hong Kong have forced many residents into microapartments, that could soon change as bigger spaces become more affordable.
Of the top 50 cities on the list, only eight hail from the United States.
San Francisco is the nation’s most expensive city, with renters needing to earn more than $US9,000 a month, or around $US110,000 a year, to afford a single-person apartment.
New York is close behind, demanding about $US100 less each month. The San Francisco Bay Area, which includes San Jose, is also cheaper, requiring a monthly salary of around $US6,300.
By far the most affordable US city on the list is Chicago, where residents can rent a single-person apartment on less than $US4,000 a month.
Apartments in Rome, Prague, and Montreal are also reasonably priced compared to the hefty salaries required in Paris, Dublin, and London.
While some cities are strained for housing stock, that’s not always the case for the most expensive cities on the list. Tokyo, for instance, has so many empty homes that some owners are giving them away for free.
There are a number of factors that influence a city’s rental prices, including land use policies, zoning restrictions, and population demographics. As these factors change, the affordability of cities could shift with time.
For now, the data suggests that even living wages may not be enough to afford rent in some of the world’s most popular locations.
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