SINGAPORE (May 23): Does higher spending power necessarily bring about an improved quality of life? Based on cities’ performances on the indices of Deutsche Bank’s annual survey of global prices and living standards, these two separate priorities can vary greatly from city to city, and very rarely balance out.  

According to Deutsche’s latest report, Mapping the World’s Prices 2018, Singapore has climbed 16 ranks to No. 25 on its Quality-of-Life Indices, which is calculated by aggregating various underlying sub-indices such as consumer purchasing power (purchasing power index or PPI) and traffic congestion and commute times (traffic commute time index).

Out of the 50 cities analysed by Deutsche, Singapore ranks second on the Safety sub-index, but falls far behind its peers at No. 45 in terms of climate.

Separately, on Deutsche’s latest Disposable Income Index after Rents – assuming two people are working sharing financial responsibilities – the city state has deteriorated four places to No. 18 despite its improvement of an average disposable income of US$2,112 compared to US$2,081 a year ago.

In fact, only four global cities have made it the top 10 in both quality of life and after-rent disposable income in DB’s study this year. These are namely: Zurich (No. 2 and 1), Sydney (8 and 4), Copenhagen (3 and 10) and Frankfurt (9 and 5).

In its report, Deutsche observes that more developed world (MDW) cities are generally “home to one of the big dilemmas in life” – that is, more money, or a better quality of life.

Tokyo is seemingly the best balance between the two, highlights the bank. The capital city ranks 13 and 15 in terms of quality of life after-rent disposable income, respectively. This balance is trailed after by the index performances of New York City, Paris, and London.  

On the other hand, Deutsche notes that emerging market (EM) cities have scored “very badly” internationally on both measures as their wages lag behind MDW peers, coupled with much-higher pollution levels, poorer health care and safety, and often a more extreme climate.

“Megacities will be home to a select group of the most affluent in society and for this group the trade-off of life in a big city possibly works more in their favour. In contrast, a low paid megacity worker may have an inferior lifestyle than their even lower paid more rural worker. However, megacities always offer that aspirational dream that possibly makes up for a poor near-term lifestyle,” notes the bank.

Other factors assessed in Deutsch’s research this year include how expensive or cheap it is to go for a weekend getaway, watch a show at a cinema or buy a cappuccino.

In Singapore, it appears to be now cheaper to rent a car given how the city state has fallen six places to 17 on the Daily Car Rental index, down 12% y-o-y.

Yet, it still remains the most expensive place in the world to buy a new mid-size car equivalent to a Volkswagen Golf, even notwithstanding extra costs, at No. 1 on the relevant index, followed by Copenhagen and Oslo.

“For those living in Singapore, Copenhagen or Oslo you’ll be pleased to know that you’re likely to be more healthy than your international counterparts as it’s so expensive to buy a car that surely you walk or cycle everywhere,” notes Deutsche.  

The bank's optimistic suggestion however may not be an option for those without much disposable income to invest in keeping fit – as Singapore also happens to have moved up a place this year to the No. 4 most expensive city for a gym membership in the business district, at an average of US$103.9 per month this year.

For now, at least, those who believe that “safety comes first” will find that Singapore ticks off all their boxes as an ideal city in which to reside.