Tel Aviv in Israel has been ranked as the most expensive city in the world to live in, according to a new poll.
The seaside metropolis, which was previously ranked fifth, topped Paris and Singapore in a report by the Economist Intelligence Unit.
Economists attributed the jump to a sharp appreciation of the shekel against the dollar.
In its report, the unit – a research group linked to Economist magazine – also pointed to increased costs for food and transportation. But the report did not include house prices, a common complaint among young professionals and families trying to live in the bustling city.
Resident Ziv Toledano said: âIt’s really difficult to live here. You pay the rent and you pay for something small and you live, say, paycheck to paycheck, so it’s really tough.
He added that his expenses had nearly doubled since leaving northern Israel for Tel Aviv.
Tel Aviv is Israel’s financial and cultural epicenter. It boasts a thriving high-tech scene, world-class restaurants and a stretch of Mediterranean beach lined with sparkling new hotels and apartment buildings.
The shekel is one of the strongest currencies in the world, with its value largely supported by heavy foreign investment in the local high-tech scene.
Dan Ben-David, director of the Shoresh Institution for Socioeconomic Research and economist at Tel Aviv University, said goods and services in Israel are generally more expensive than in other countries.
Tel Aviv was also more expensive because it was the economic hub of the country, with well-paying tech jobs attracting talent from across the country that pushed up the cost of food and rent.
âIsrael is expensive, and in that regard, Tel Aviv is more expensive than other places in Israel because that’s where the good jobs are,â he said.
The city also attracted Israelis who wanted to live near its vibrant cultural and social scene.
The problem, Mr Ben-David said, was major congestion leading to the city and inadequate transport links to surrounding suburbs and towns, causing even more people to want to reside in the city.
This, along with foreign buyers, had caused real estate prices to skyrocket, making buying an apartment in Tel Aviv almost inaccessible to the average Israeli, with modest apartments in prime areas costing four million. of shekels, or more than Â£ 950,000.
Ten years ago, hundreds of thousands of Israelis took to the streets to demand a solution to the rising cost of living.
Successive Israeli governments have struggled to create better employment opportunities in other parts of the country and attempts to expand public transport are underway.