Asia most expensive region for luxury buying; Mumbai cheapest city: Report

Asia is the most expensive region for high-end buying.
Asia has five of the ten most expensive cities globally and it’s the most expensive region for high-end consumption, like for upscale residential property and high-end cars, said a report that predicted India’s luxury goods market to grow 6 per cent annually.

Julius Baer’s first Global Wealth and Lifestyle Report surveyed 28 cities around the world: ten in Asia, twelve in Europe, Middle East and Africa (EMEA), and six in the Americas. Hong Kong was the world’s most expensive city and Mumbai the cheapest.

The Mumbai property market was steady in the first quarter of 2019, but is expected to improve with a more balanced supply and demand environment and improved liquidity, said the report.

Mumbai offers exceptional value across almost all luxury categories. “Wealthy residents have access to property at roughly a tenth of the price of the most expensive city, and wellness services are among the cheapest, including the best-value personal trainers. In fact, several services are priced in or close to the bottom quartile. Only cars, pianos, wine and business class flights exceed the global average.” 

India’s luxury goods market is valued at around $8.3 billion per annum, growing at more than 6 per cent a year.

For luxury cars, specifically, eight of the ten most expensive cities are found in Asia. However, for smaller items, Asia provides better value.

The Chinese now drive global demand for luxury cars, with young buyers and women in that country making up a significant share. "Advances in electric technology promise to revolutionise personal transport. But without more efficient batteries and a proper recharging infrastructure, electric cars will likely remain premium products," the report said.

Younger consumers are increasingly into experiential luxury, which could prove a boon for industries such as tourism, travel and dining.  

Since the financial crisis, a combination of low interest rates and a flight to quality has caused real-estate prices to surge in the global gateway cities of London, New York and Hong Kong, observed the report. "In the past year or so, demand has spread to secondary locations where better value is available, such as Munich, Manila and Miami, and also new areas of major cities," said the report.

European cities offer the best value. The continent’s best-valued cities for luxurious living are Barcelona and Frankfurt. Barcelona’s prime property market remains relatively inexpensive compared to European peers, while Frankfurt is cost-effective particularly for portable high-end goods and hotel suites. On the other hand, London is the most expensive city in the continent and Zurich comes next because of high service charges, costly hotels and dining in both cities.

Asia: Relative ranking of luxury goods by cost per city in US dollars
  Hong Kong Singapore  Shanghai  Mumbai  Taipei
Residential property 1 3 4 8 6
Jewellery 10 6 5 7 8
Cars 3 1 2 6 4
Watch  6 7 2 9 3
Fine dining 1 2 3 9 5
Source: Julius Baer Global Wealth & Lifestyle Report 2020



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