Why Is Mumbai the Most Expensive City in the World for Locals?

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How much would it cost for the average local to buy a luxury apartment in the world's most important cities? In Singapore, it would take four decades of income. In Shanghai, two centuries. And in Mumbai -- poor souls -- they'd be looking at a good three centuries of hard work.

Those numbers come courtesy of Bloomberg, which yesterday compiled the chart below (I've recomposed it for readability). The news service calculated how many years worth of earnings it would take the average national to buy a high-end, roughly 100-square-meter piece of real estate in each city. (That comes out to about 328-square-feet, or a studio apartment in America). 

Most_Expensive_Cities_for_Locals.PNG

Now what does this chart tell us, other than the fact that Manhattan home buyers have nothing to complain about compared to, say, Parisians? Each market has its own unique circumstances. But I think this graph is largely about the impact of globalization on property, that most local of all commodities. 

The top three cities on this list have all developed wildly wealthy upper classes thanks to global trade, whether they're oil oligarchs in Russia or chemicals magnate in India. But they also have widespread poverty and a relatively tiny middle class. Cities in the developed world are also paying a different kind of globalization premium. In London, for instance, fancy apartments have become hot investments for the rich international buyers looking for a place to park their money. The same thing is happening in Sydney, where wealthy Asians are also snapping up residences as investments, or sometimes as places to retire. 

Of course, there are probably exceptions. Manhattan has enough of its own uber-wealthy to push the cost of prime real estate to astronomical heights without help from abroad. But as the world's rich get richer, we can expect the most expensive cities to become more expensive. At least, that is, if you're in the market for a place as cool as this.

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Jordan Weissmann is a senior associate editor at The Atlantic.

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