The combination of North and
South America cost of living rankings has the oil rich countries of Venezuela
and Brazil as the most expensive places to live for expatriates in the
Americas.
Caracas is the capital and
largest city of Venezuela. Caracas
is the Americas most expensive place to live in July 2012, both overall and
based on the cost of living excluding the housing, education, healthcare and
transport baskets. Sao Paulo and Rio de Janeiro in Brazil follow a close 2nd
and 3rd. Overall Caracas, is the
5th most expensive place to live in the world and has an overall cost of living
index of 135,7. Important industries in Caracas include chemicals, textiles,
leather, food, iron and wood products. Caracas is a regional centre for the
distribution of products.
The economy of Venezuela is
dominated by the petroleum sector accounting for roughly a third of GDP, around
80% of exports and more than half of government revenues. Gold, diamonds and
iron ore are mined as well. Venezuela contains some of the largest oil and
natural gas reserves in the world and consistently ranks among the top ten
crude oil producers in the world.
Venezuela is a country ruled by politics. Irrespective of the socialist system
instituted by President Hugo Chávez, with vigilant price controls for a range
of basic products and a wave of nationalizations and expropriations, life in
Caracas perhaps more than in any other Latin American capital, is still defined
by its reliance on one volatile commodity: oil.
Despite oil prices being
relatively low, oil-export proceeds create arbitrage opportunities for everyone
in the community. The abundance of oil further attracts companies that want to
extract it, regardless of the politics. Hence the influx of these people from
as far as China and Russia, including representatives from other multinational
groups selling products in Venezuela, explains why even a basic apartment in
Caracas can be rented for as much as $4,000 a month, with rents in some
districts running to double or triple that amount.
Caracas also differs from cities
elsewhere in the hemisphere in that Venezuela operates a stringent system of
controls of the currency, the optimistically named bolÃvar fuerte, or “strong
bolÃvar.”
*On January 2010, the government of Venezuela created a two-tiered
official exchange rate system. Imports designated as "non-essential"
receive a rate of 4.3 bolivares per dollar, and "essential" goods are
exchanged at a rate of 2.6. There is also a third and unofficial exchange rate
in the black market valued at around 6.8 bolivares per dollar (March 2010).
The Venezuelan government decides what "essential" goods
qualify for the 2.6 rate. They include imports for sectors related to food,
health, education, equipment, and technology; remittances to relatives settled
abroad; students' academic expenses abroad; expenses related to health, sport,
culture, and scientific investigations; payments to retired and resident
pensioners abroad; and currency conversions related to diplomatic activities.
Full details (in Spanish) can be found through the Central Bank
of Venezuela.
Caracas is particularly expensive
for clothing, education and groceries.
For example a litre of milk costs around 1.60 USD and a loaf of white bread
1.80 USD in Caracas compared to 0.90 GBP / 1.40 USD and 1.03 GBP / 1.62 USD
respectively in London. Not everything in Caracas is expensive, while a litre
of petrol costs around 0.13 USD in Caracas, it can cost around 1.02 USD in New
York.
The cost of living in Caracas in
Venezuela is very high compared to other places with the overall cost of living
being determined using the prices for defined quantities of the same goods and
services across 13 Basket Groups of 780 places.
Alcohol & Tobacco costs are
very high compared to other places sitting at 57th more expensive in comparison to 780 other places, for
items such as alcohol at a bar, beer, locally produced spirit, whiskey, wine
(where alcohol is legally sold) and tobacco related products.
Domestic Beer can cost up to
$2.60, while Imported Beer is approximately $4.30 and a pack of Marlboro
Cigarettes will set you back almost $5.
The cost of Clothing is also
very high and Caracas is the 4th
most expensive for items such as business suits, casual clothing, children's
clothing, coats, evening wear, footwear, hats, shoe repairs and underwear.
A ladies suit consisting of a blazer/jacket,
summer dress, pantyhose and a pair of shoes can cost between $250 – 730 while a
man’s suit including blazer/jacket, shirt, jeans, socks and a pair of shoes
will set you back between $350 – 430. A pair of Levis can cost up to $100 and a
plain Zara or H&M summer dress ranges up to $80 - 100.
When it comes to shopping you can
find the same quality clothes and appliances as in the US, but it can cost up
to three times the price.
Communication costs are average
compared to other places for various costs such as call charges, home telephone
rental, Internet connection, mobile data costs, mobile phone contract and
service provider fees. There are 389
places that are more expensive, and 390 places that are less expensive for
communication.
A Prepaid Mobile Tariff for local
calls (including no discounts or plans) comes to $.042 per minute, while the
internet (6Mbps, with unlimited data via Cable/ADSL) can cost approximately $49
per month.
Education costs are very high
compared to other places for items such as creche / pre-school fees, primary
school fees, high school fees and tertiary study fees. There is 1 place that is more expensive.
An international school can cost
approximately the following per Year group for annual tuition and often there
is a one-time capital fee that must be paid :
PreNursery - N-PK: $10,078;
Kdg.- grade 5: $18,076;
Grades 6-8: $22,481;
Grades 9-10: $23,473; and
Grades 11-12: $24,128.
Furniture & Appliance costs
are very high compared to other places for items such as a DVD player, fridge /
freezer, furniture, household equipment, iron, kettle, light bulbs, microwave,
television, toaster, vacuum cleaner and washing machine. There is 1 place that is more expensive, of the 780
comparable places.
Grocery costs are the highest compared to all other 780 places
for items such as baby consumables, baked goods, baking, canned foods, cheese,
cleaning materials, cleaning products, dairy, fresh fruits, fresh vegetables,
fruit juices, meat, oil & vinegars, pet food, pre-prepared meals, sauces,
seafood, snacks, soft drinks, spices & herbs.
The price for a basket of 39
items ranges between $465 - 505, and these are on the increase. A 1.5 litre
bottle of water can cost $2.00, a bottle of mid-range wine $15 and domestic 0.5
litre beer $2.20.
Healthcare costs are very high with
Caracas sitting at the 6th
most expensive place for general healthcare, general practitioner consultation
rates, healthcare/medical insurance, hospital private ward daily rate and
non-prescription medicine.
Household Accommodation costs place
Caracas at the 27th most
expensive for items such as accommodation, apartment, flat, house, villa, rent,
electricity, household fuels, household gas, water, and local property rates /
residential taxes / levies.
Basic Electricity, gas, water and
garbage rates for a 85m2 Apartment can cost up to $86, while a house
for rent in La Lagunita with a garden, pool, barbecue, service areas,
electrified perimeter, closed street surveillance and daily maintenance can
cost up to $11 600/month.
Comfortable neighbourhoods for
expats to live in with a family, include Valle Arriba, Lomas de la Alameda,
Campo Alegre and Santa Rose de Lima/Lomas de San Roman/Lomas de Tamanaco and la
Lagunita. Other attractive areas comprise
Altamira, and Los Palos Grandes as they are close to public transportation,
goods and service stores, restaurants, cafes and business centers and are also
considered safe areas to live in.
Las Mercedes can be noisy, but it
is safe with all the amenities in walking distance. Most children play in areas
set aside for them in apartments rather than in parks. There is one large, safe
park in the city, Parque del Este, which is near the neighborhood La Florida.
For pricing and availability use
a real estate agent that can help you find the right area to live in - www.porlapuerta.com.
Miscellaneous costs for items
such as dry cleaning, general goods, general services, linen, magazines, maid,
newspapers, office supplies, postage stamps and stationery place Caracas at 81 more expensive, e.g. a subscription
to the Economist for 51 weeks can cost up to $337.
Personal Care for items such as
cosmetics, hair care, moisturizer, nappies, pain relief tablets, shampoo, soap,
sun block, toilet paper and toothpaste, are very high with 47 places more expensive.
A 2 in 1 shampoo can cost $12,
while woman’s cosmetic that cost the equivalent of $3 in Europe can cost $11 in
Caracas.
Recreation and Culture costs
place Caracas at 49th most
expensive for items such as books, camera, cinema tickets, fitness/health club
membership, sports goods and theatre tickets.
A monthly Club Fitness membership
can cost $57 for 1 adult while a cinema ticket for an International movie can
cost up to $8.
Restaurants, Meals Out and Hotel costs
are very high compared to other places for items such as a business dinner,
dinner at a family restaurant (non-fast food), 4 star and 5 star hotel rates
and take away meal (fast food). There are 6
places that are more expensive.
A reasonable restaurant can cost
between $46 – 50 for a dinner including a starter, main dish and a desert per
person. The cost of a double room
at a 5 Star hotel $194 - 215, a cappuccino $21.0 and a Combo McDonalds Meal
$8.53.
At 44th most expensive Transport costs
are very high compared to other places for items such as car hire purchase, car
insurance, car lease, car maintenance, car rental, car service, diesel, petrol,
tyres and public transport.
A round trip ticket on the Metro
de Caracas will cost about 75 cents -- pricier than Mexico City's system, but a lot cheaper
than some of the high dollar systems you find in the U.S.
A normal train ticket one way can
cost $0.55 while a monthly pass can cost up to $14.
A 5km/3mile taxi ride can cost
between $6 – 6.97, while the normal 1km tariff is $4.25. Gasoline will cost you up to $0.14 per litre. Public transportation is fairly accessible almost anywhere
but can be challenging with children in tow.
Personalized cost of living indexes for Caracas in Venezuela are based on the
basket groups and comparison location(s) selected in the Calculators.
In terms of the hardship people are likely to experience, assessed in global
terms, Caracas in Venezuela is ranked as extreme hardship with a hardship index
of 40%.
Cost of Living Rank - The Americas Locations - Overall Cost of Living & All
Baskets (Highest to Lowest):
10. Canada, Edmonton
Further interesting reading on
the rising costs in Caracas can be read here:
Denise
is an Expat and Marketing Manager at http://www.xpatulator.com/ a website that provides cost of living index
information and calculates what you need to earn in a different location to
compensate for cost of living, hardship, and exchange rate differences. The
complete cost of living rank for all 13 baskets is available here.
