Cost of Living in Hong Kong

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The cost of living in Hong Kong can be high for expats, with some reports putting the region's cost of living as the highest in the world.

In 2016, the Pearl of the Orient topped Mercer's Cost of Living for 2016 survey, thanks in part to the region's extremely overinflated property market, which makes finding accommodation an expensive endeavour. Add to that the fact that most produce and commodities are imported, and one tends to find that the necessities of life are generally more expensive in Hong Kong than in other cities.

Nevertheless, high expat salaries tend to offset these costs, and many find their quality of life is higher than it was back home.

Cost of accommodation in Hong Kong

Housing in Hong Kong is notoriously expensive and, depending on their needs, expats can expect a high percentage of their salary to be spent on a small but perfectly formed apartment. The tiny, older Chinese-style apartments will always be more reasonably priced, but may not afford the space that Western expats often prefer.

Cost of public transport in Hong Kong

Public transport is cheap, clean and reliable. By contrast, owning and maintaining a car in Hong Kong is very expensive. Most people find that they don’t need one if they live centrally and the cost – and risk of bumping into erratic taxi drivers – is not worth it.

Cost of education in Hong Kong

Education is free in Hong Kong for state-run schools but the majority of expats who arrive with kids prefer to send them to one of the region's private international schools that teach in English and follow a Western curriculum. These can be incredibly expensive and expats should make sure their salaries or package will cover school costs before signing a permanent contract.

Cost of healthcare in Hong Kong

Healthcare is free for expats using the public system, which is very good but heavily oversubscribed. Most organise a private insurance plan through their employer.

Cost of food in Hong Kong

Thanks to its proximity to China, there are many things that can be picked up cheaply in Hong Kong. Household supplies, clothes and other bits and pieces are made just across the border and transported freely into Hong Kong, and are thus very affordable. China also provides a lot of Hong Kong’s fresh food and grocery items, and if expats are happy to go local in terms of produce origin, the weekly shop can be easy on the wallet.

That said, most Westerners prefer not to buy local produce, especially with stories of questionable farming practices and food additive scandals hitting the papers regularly. Expats buying imported goods can expect to pay double for many food and produce items (especially meat), with the result that grocery shopping costs will quickly add up.

There is no shortage of Western items on international supermarket shelves: Tim Tams and Vegemite for the Australian market, graham crackers and ranch dressing for US expats and Tiptree jam and Marmite for the Brits. Not to mention the Japanese supermarkets, Thai food shops and Philippine speciality stores stocking their own culinary assets from home.

Income tax in Hong Kong

Income tax in Hong Kong is famously very low (between two and 17 percent, depending on personal circumstances), and residents have a fairly generous annual tax-free allowance before the government takes anything.

Tax is all done on a personal tax return basis, and not pay-as-you-earn. When starting work, it is advisable to start saving tax somewhere so it is ready and waiting when the tax return is filled in, and the bill from the Hong Kong Inland Revenue in its distinctive green envelope is received.