Tel Aviv no longer the world's most expensive city, drops to third

The British magazines ranked close to 200 cities across the globe based on the pricing of hundreds of individual items and services offered in those cities.

An aerial shot of a Tel Aviv beach (photo credit: BARAK BRINKER/TEL AVIV-YAFO MUNICIPALITY)
An aerial shot of a Tel Aviv beach
(photo credit: BARAK BRINKER/TEL AVIV-YAFO MUNICIPALITY)

Tel Aviv lost its title of the world's most expensive city this week when it was toppled by New York City and Singapore in The Economist's annual list of least and most expensive cities in the world published on Wednesday.

Tel Aviv cracked the top five in 2020's list before leaping to the top a year later, mostly due to the NIS's strong showing in the foreign exchange market compared to the Euro and the US dollar.

How is the list compiled?

The British magazines ranked close to 200 cities across the globe based on the pricing of hundreds of individual items and services offered in those cities.

These can include a McRoyal meal at the international fast food chain McDonald's, one kilo of apples and a month's rent for a two-bedroom apartment, which are all then compared to the purchasing power of the city's average salary.

A food delivery man waits outside a McDonalds restaurant in Tel Aviv. April 18, 2020 (credit: MIRIAM ALSTER/FLASH90)A food delivery man waits outside a McDonalds restaurant in Tel Aviv. April 18, 2020 (credit: MIRIAM ALSTER/FLASH90)

This means that, even if a certain service is more expensive in some cities, the actual cost of living is measured and ranked in proportion to the average wage in the examined city.

One of the metrics measured by the Economist that helped see Tel Aviv rise to the top last year was the cost of an average family vehicle, an item that was introduced to the magazine's statistical database used to compile its list. Tel Aviv is ranked as one of the most expensive cities in this parameter.

At the bottom of the list, some of the world's least expensive cities include the Iranian capital of Tehran, Tunis, Tashkent, Tripoli and Syria's Damascus.