London Again Ranked Costliest City - Is This a Problem

It has recently been announced that London has once again knocked Hong Kong off the top spot when it comes to being the most expensive city in the world. Nowhere else on the planet costs quite as much for companies to relocate their employees, and for those employees to live. It's long been known that London boasts some of the most coveted space in any city anywhere, both commercial and residential, but is it becoming a real issue

The report, issued by Savills, says that it costs in excess of £70,000 for a company to accommodate an employee in the capital, which has two significant points. The first of course is that this could well continue to put off businesses from setting up shop in London if things become prohibitive. With the referendum keeping Scotland as part of the UK, cities such as Edinburgh remain as alternative options for some financial institutions. The report also goes to show again just how expensive it is for someone to move to and work in London.

All of this is potentially a moot point however. Many will argue that the announcement of London being the world's most expensive city illustrates one thing and one thing only. And that is that London is one of if not the most attractive places in the world to live and work. There's no sign that office space is being unused, and perhaps the most important metric is that London is not that far ahead of its closest rival Paris. This quite simply means that rather than having a price problem, it is both competitive and on top, no doubt partly thanks to particularly impressive and exclusive office locations.

It's also worth noting that Savills' decision to move London above Hong Kong has not been entirely down to changes in the cities themselves. Yolande Barnes, a director at the company has said that currency fluctuations are just as much to blame as any significant change in the property markets.

To conclude, this is all potentially good news for the property market in the capital, as there are few signs that the influx of tenants, both private and commercial, is subsiding. It may be of concern to those that believe the country is becoming too London-centric however, and the UK's other big cities will continue to face the challenge of the talent pull that is the capital.