As the cost of living continues to rise across Europe, driven by increasing food prices, fluctuating energy costs, and housing market pressures, I am sharing our latest report, which ranks the most and least affordable European capitals by assessing the cost of living based on local monthly income.
To uncover which capitals offer the most comfortable standard of living with the least financial strain relative to monthly income, the team at Tradingpedia compared data from 37 European capitals, taking into account everyday expenses and average monthly salaries. The report provides a comprehensive breakdown of essential expenses, including housing, food, transportation, personal care, and entertainment, to offer a clear picture of affordability across the continent. The complete dataset behind the report is also available on Google Drive via this link.
According to the price and income comparison, Luxembourg, Bern, and Brussels are Europe’s most affordable capitals, where expenses account for less than 50% of the average monthly income. In contrast, residents of Warsaw and Tirana face the greatest financial burden, with living expenses exceeding average monthly earnings by more than 20%.
Here are some key takeaways from our report:
- Luxembourg ranks as the most affordable European capital. A single person spends about €2,237 per month on essentials like rent, food, and transportation, which accounts for just 40.2% of the city’s median wage of €5,590. That leaves residents with €3,353 each month to save or spend.
- Although Bern is among Europe’s most expensive capitals, it ranks second in terms of affordability. Monthly living costs average €2,540, but this represents only 40.6% of Bern’s median salary, which is also the highest among European capitals at €6,262.
- Brussels ranks third with costs amounting to just 49.6% of the average monthly wage. A single person spends around €1,376 per month, while the median income stands at €2,773.
- Warsaw ranks as the least affordable European capital. The average resident earns €1,701, but faces monthly expenses of €2,167, a shortfall of €466. High costs for housing, food, and entertainment strain household budgets.
- Tirana faces a similar issue to the capital of Poland. Monthly living expenses average €818, while the city’s median wage is only €673. That leaves workers €145 short each month, making it one of the most financially challenging capitals in Europe.
- When one looks solely at prices, the most expensive European capitals are Reykjavik, London, and Amsterdam with expenses over €2,500, while the least pricey cities are Minsk, Sarajevo, and Chisinau where people need between €500 and €650 to cover their expenses.
Our report highlights that high costs don’t always indicate unaffordability. For example, Bern and Copenhagen are among the most expensive capitals, yet they also rank among the most affordable, with the basic monthly costs accounting for just 40.6% to 54.7% of the average monthly wage. On the other hand, Chisinau ranks third for the lowest prices in Europe, but is also among the least affordable, with monthly expenses amounting to 104.1% of the average salary.
Besides Luxembourg, which ranks as the most affordable in each category, it is followed by London for food affordability, Prague for public transport, and Bern for entertainment costs.
