Many years ago, a former mayor of Berlin, Klaus Wowereit declared Berlin a “poor but sexy” city – so how is this regarded by expats today? In the latest HSBC survey, 70% of expats rated Berlin as very sexy – with a huge cultural scene, which put it at the top of the ‘culture’ rankings – out of the 52 cities surveyed.
The HSBC survey regards anyone over the age of 18, currently living away from their home country, as an expat. It includes people from any country in the world and they don’t have to be professionals. In this new survey, 27 587 expats responded from 159 countries and rated their current cities according to career opportunities, salary levels, the culture on offer and whether living there improved their physical well being.
Berlin is top for culture but not for income
Berlin tops the rankings for culture, followed by Buenos Aires and London in third place. However, while it might be a cultural mecca, Berlin expats report that their gross personal income (total income from all sources including salaries, rents and before tax deductions) is below the global average of $99, 903. Coming in at $84 162, Berlin rates towards the bottom of the rankings, coming in 43rd out of 52 countries.
Despite this, expats in Berlin report that their cost of living is very affordable and while their salaries might not attract expats looking for big money, they have more disposable income than they did back home. The only city that beats Berlin when it comes to disposable income is Bangkok.
Berlin is still struggling
According to the Cologne Institute for Economic Research, Berlin is still struggling financially and is the only capital in Europe that is a drain on the country’s overall GDP. When one considers how much poorer a country would be without its capital city, Berlin is considered to be a liability. For example without London, the UK would be 11% poorer per capita. France would be 15% poorer if it lost Paris, but the average German would be 0.2% wealthier if they didn’t have to support their struggling capital, which is burdened with approximately €59 billion in debt.
If you’re an expat arriving in the city and need to process basic bureaucratic necessities like registering a new car or getting married, you will find that these can take an endless amount of time due to underfunded administrative offices that are stretched far beyond capacity. In terms of infrastructure, underinvestment has left the city with many uncompleted buildings that endlessly disrupt the traffic. An example of this is the city’s international airport – the Berlin Brandenburg, which was started in 2006, predicted to open in 2011, but will now only open in 2020 or later due to endless mismanagement, which has escalated the price from the predicted €2 billion to the latest estimate of €7 billion.
If you are living abroad in Berlin experiencing its wealth of museums, galleries and nightlife or are planning on relocating to Germany, contact FinGlobal for expert, personalised advice concerning financial emigration, competitive foreign exchange rates and other financial aspects relating to living abroad including transferring retirement annuities and tax refunds.