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Living cost in Shanghai

by reachhome on 2018年7月20日
, Living cost in Shanghai
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Following our previous article on the “advantages of living in a second-tier cities” we will this week go deeper into what the actual cost of living is in first- and second-tier city. As many people expect that the cost in a second-tier city is cheaper, we will here analyze if this expectation is accurate and if so, how much cheaper?

In our research we have compared pricing in 6 categories; Food, Housing, Clothes, Transportation, Personal Care and Entertainment.

Let us take a look at how the prices between Tier 1 and 2 compare and ultimately what this means to you as somebody moving to China. With the information presented, you will know what to expect both financially and culturally.

According to mercer recent studies, Shanghai and Beijing are respectively positioned as the 7th and 9th most expensive cities for expats to live in 2018.

1st Tier Cities

Tier 1 cities represent the most developed areas of the country. Large densely populated urban areas with huge economic, cultural and political influence in China. Tier 1 cities attract a lot attention from foreign organizations because they have higher income levels than the national average. These cities are Shanghai, Shenzhen, Guangzhou, and Beijing.

Things to note when discussing each Tier 1 city in China:

  • Some of the biggest cities globally
  • Populations between 10 to 26 million people
  • Talent pools for hiring are educated and qualified for most industries
  • Have the highest salaries
  • Have the highest real estate/home rental prices

2rd Tier Cities

Tier 2 cities may sound small but don’t let the name fool you. Tier 2 cities in China still can have up to millions of people and have a huge influence in the nation’s economic industry. These cities include Chengdu, Kunming, Hangzhou, Urumqi, Tianjin, Wuhan, etc.

For example, a 50sqm retail location in Hangzhou (Tier 2) can cost 15,000 RMB, the same as a 12sqm location in Shanghai (Tier 1). According to BCG, 60 percent of China’s economic growth will come from Tier 2 and Tier 3/4 cities by 2020. In addition, Tier 1 and Tier 2 cities make up more than 55% of the national GDP. Approximately 65% of fast moving consumer goods sales come from Tier 3 and lower tier cities.

For expats no matter the career, you’ll experience a different lifestyle between tiers 1 and tier 2 or 3 cities

Below is a table that provides a rough overview on the cost of living for the major urban centers in China as well as a second-tier city.

 

Expat Concern: Cost of Living in Shanghai (1st Tier) vs Chengdu (2nd Tier)

Food

1st tier            2nd Tier

 

Basic Lunchtime menu (including drink) in business district. 64 RMB 35 RMB 10 USD 5.47 USD
 

Combo meal in a fast food Chain (Mcdonalds or similar)

36 RMB 36 RMB 5.40 USD 5.40 USD
500 gr (1 lb) of Boneless Chicken Breast 25 RMB 18 RMB 3.50 USD 2.98 USD
 

1 Liter (1 qt) of whole fat milk

25 RMB 21     RMB 3.90 USD 3.28 USD
 

12 Eggs Large

21 RMB 16 RMB 3.24 USD 2.00 USD
1 kg (2 lb.) of Tomatoes 15 RMB 17 RMB 2.27 USD 2.65 USD
 

500 gr (16 oz.) of local Cheese

102 RMB 70 RMB 15.00 USD 10.93 USD
 

1 kg (2 lb.) of apples

21 RMB 12    RMB 3.11 USD 1.87 USD
 

1 kg (2 lb.) of potatoes

12 RMB 8      RMB 1.77 USD 1.25 USD
0.5 L (16 oz.) domestic beer in supermarket 6 RMB 6 RMB 0.91 USD 0.91 USD
 

1 Bottle of red table wine

125 RMB 100 RMB 19 USD 15.62 USD
 

2 Liters of Coke

8 RMB 8 RMB 1.26 USD 1.26 USD
 

Bread for two people 1 day

30 RMB 18    RMB 4.47 USD 2.81 USD

 

Housing

1st tier                   2nd Tier

 

Monthly rent for 85 m2 furnished accommodation in EXPENSIVE area

 

14,484 RMB

 

6,900 RMB

 

2,189  USD

 

1,078 USD

Monthly rent for 85 m2  furnished accommodation in NORMAL area  

8,316 RMB

 

4000 RMB

 

1,257 USD

 

625   USD

Utilities 1 month (heating, electricity, gas …) for 2 people in 85m2 flat 463  RMB 250  RMB 70 USD 39.8 USD
Monthly rent for a 45 m2 (480 Sqft) furnished studio in EXPENSIVE area 7,237 RMB 3,500 RMB 1,093 USD 547 USD
Monthly rent for a 45 m2 (480 Sqft) furnished studio in NORMAL area 4,818 RMB 2,500 RMB 728 USD 391 USD
Utilities 1 month (heating, electricity, gas …) for 1 person in 45 m2 (480 Sqft) studio 273  RMB 175  RMB 41 USD 27.34 USD
Internet 8 Mbps (1 month) 121 RMB 100  RMB 18 USD 15.6 USD
40” flat screen TV 3,340 RMB 3,200 RMB 505 USD 500 USD
Microwave 800/900 Watt (Bosch, Panasonic, LG, Sharp, or equivalent brands) 796 RMB 780 RMB 120 USD 11.6 USD
Laundry detergent (3 l. ~ 100 oz.) 60 RMB 45 RMB 9 USD 7.03 USD
Hourly rate for cleaning help 40 RMB 25 RMB 6.20 USD 3.90 USD

 

Clothes

1st tier            2nd Tier

1 Pair of Jeans 736 RMB 500    RMB 111 USD 78.12 USD
1 Summer dress in a high-end store 370 RMB 280    RMB 55.1 USD 43.75 USD
1 Pair of Sport Shoes (adidas, nike) 900

RMB

650

RMB

135 USD 101.56 USD
1 Pair of men’s leather business shoes 1,017 RMB 750

RMB

159 USD 117.18 USD

 

Transportation

 

Volkswagen Golf 1.4 TSI 150 CV (or equivalent), with no extras, new 154.000 RMB 153.500 RMB 24,062 USD 22,906 USD
1 liter (1/4 gallon) of gas 7.6 RMB 7.4 RMB 1.13 USD 1.1 USD
Monthly ticket public transport 222 RMB 210     RMB 34 USD 32.8 USD
Taxi trip on a business day, basic tariff, 8 km. (5 miles) 53 RMB 28 RMB 8 USD 4.37 USD

 

Personal Care

 

Cold medicine for 6 days (Tylenol, Frenadol, Coldrex, or equivalent brands) 34 RMB 23 RMB 5.10 USD 3.6 USD
1 box of antibiotics (12 doses) 43 RMB 30 RMB 6.72 USD 4.68 USD
Short visit to private Doctor (15 minutes) 737 RMB 380       RMB 111 USD 59.37 USD
1 box of 32 tampons (Tampax, OB, …) 34 RMB 29 RMB 5.21 USD 4.53 USD
Deodorant, roll-on (50ml ~ 1.5 oz.) 35 RMB 32 RMB 5.29 USD 5 USD
Hair shampoo 2-in-1 (400 ml ~ 12 oz.) 43 RMB 41 RMB 6.72 USD 6.41 USD
4 rolls of toilet paper 12 RMB 10 RMB 1.87 USD 1.56 USD
Tube of toothpaste 21 RMB 20 RMB 3.21 USD 3.1O USD
Standard men’s haircut in expat area of the city 80 RMB 48 RMB 12.5 USD 7.5 USD

 

Entertainment

1st tier                2nd Tier

Basic dinner out for two in neighborhood pub 225 RMB 140  RMB 34 USD 21.87 USD
2 tickets to the movies 123 RMB 85    RMB 19 USD 13.30  USD
2 tickets to the theater (best available seats) 913 RMB 800   RMB 138 USD 119 USD
Dinner for two at an Italian restaurant in the expat area including appetizers, main course, wine and dessert 470  RMB 290   RMB 73.44 USD 45.31 USD
1 cocktail drink in downtown club 80 RMB 50 RMB 12.5 USD 7.81 USD
Cappuccino in expat area of the city 35 RMB 25 RMB 5.27 USD 3.9 USD
1 beer in neighbourhood pub (500ml or 1pt.) 47 RMB 30 RMB 7 USD 4.69 USD
iPad Air 2, 64GB 3,967 RMB 3,900  RMB 620 USD 609 USD
1 min. of prepaid mobile tariff (no discounts or plans) 0.51 RMB 0.25   RMB 0.08 USD 0.04 USD

Conclusion

Upon analyzing the differences between Tier 1 and 2 cities we can come to a few simple conclusions that will help your transition into China be seamless. Most 1st tier cities such as Shanghai and Beijing will charge up to double or more on real estate and housing than 2nd tier cities. Transportation prices such as taxi services also differ between the 2 Tiers, with the basic fare in Shanghai being 14 RMB compared Chengdu’s 8 RMB. However imported goods show very little price variation between 2nd and 1st tiers.

In conclusion, 2nd tier cities, usually the more coastal ones, are similar in pricing with 1st tier cities with differences lying mostly in transportation and lodging. On the other hand, inland 2nd tier cities with no coastal access will be much cheaper than the 1st tier cities, and coastal 2nd tier cities. We at JRE wish you

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