guides & articles

Related listings

Latest Postings

Subscribe to the hottest news, latest promotions & discounts from STClassifieds & our partners

I agree to abide by STClassifieds Terms and Conditions

Self-Improvement & Hobbies

Want to be in a rich girl's shoes? You'll feel the pinch

It's tough to be rich in Singapore.
The Business Times - September 26, 2012
By: Siow Li Sen
| More
Want to be in a rich girl's shoes? You'll feel the pinch For 2012, the average Julius Baer Lifestyle Index across the four cities rose 8.8 per cent, down from last year's 11.7 per cent -PHOTO: REUTERS

[SINGAPORE] It's tough to be rich in Singapore. For the ladies, a pair of classic Louboutin pumps costs US$2,714 here, compared with only US$1,005 in Hong Kong. A Chanel bag comes at US$5,781 versus US$4,921 and a Tiffany 2 carat diamond ring sets you back US$159,910 against US$116,452. For the men, a gold Rolex Oyster costs US$33,341 in Singapore against US$32,207 in Hong Kong and a Cohiba cigar, at US$1,375, is three times as expensive here.

And this is before one even touches on high-end property, whose prices have shot through the roof this year.

But if it is any consolation, a wedding banquet for 500 at a top Hong Kong hotel would cost US$121,100 against US$67,482 in Singapore while memberships to classy golf clubs also cost almost 50 per cent more there.

A Julius Baer Lifestyle index released yesterday has found that the rich in Singapore suffered the highest inflation rate of 13.7 per cent to maintain their lifestyle against their friends in Hong Kong (10.8 per cent), Shanghai (8.8 per cent) and Mumbai (2.6 per cent). This is despite the fact that the Singapore dollar has strengthened more than 5 per cent against the greenback this year.

The index, in its second year, comprises 20 items, capturing both goods and services in US dollars, in Mumbai, Shanghai, Hong Kong and Singapore.

"Naturally, the selection of items covered in the Julius Baer Lifestyle Index is subject to individual taste. However, the goods and services chosen for the index should better reflect the lifestyle choices and consumption patterns of high net worth individuals than the more traditional consumer price indices available," said Julius Baer.

For 2012, the average Julius Baer Lifestyle Index across the four cities rose 8.8 per cent, down from last year's 11.7 per cent.

This rate of increase was well above regional, traditional consumer price indices of about 6 per cent, the private bank said.

"Singapore was home to the highest price hikes in US dollar terms, followed by Shanghai, Hong Kong and lastly Mumbai. Across the region, the prices of high-end wine, wedding banquets, handbags and business-class air travel underwent the largest increases," it noted.

Julius Baer spokeswoman Lim Li Koon said the increase for Singapore is mainly due to the property score, which jumped 35 per cent.

Homes of the ultra rich in US dollar terms went from US$9.7 million to US$13 million, she said. Many other items actually saw no change or even slight declines. Jewellery, shoes and handbags, for example, did not change in price at all. Wedding banquets went up 10 per cent, but this happened in most of the cities. Cars also went up another 5 per cent. The Singapore story is skewed heavily by massive property price movement, she added.

Stefan Hofer, Julius Baer emerging markets strategist, said driving the index was property and prices of luxury articles which have pricing power compared to services.

"For example, watches have been able to increase their prices relative to service providers like lawyers and hospitals," he said.

It's still no comfort to the ladies should they suffer the indignity of a fall from their 8-inch heels, as a night in a posh Singapore hospital at US$756 far exceeds Hong Kong's US$464. And if you want to make sure your spouse does not fritter the hard earned cash away, a family lawyer costs US$660 per hour here, almost double that in Hong Kong. One consolation is that a facelift in Singapore at US$2,559 is far cheaper than the other cities. Ditto root canal treatment.

So how do the rich cope with the almost 14 per cent inflation?

According to David Lim, chief executive of Julius Baer Singapore, they remain conservative in their investments, spending only a fraction of their wealth to maintain their lifestyle.

"They're not expecting a 14 per cent return, not becoming more aggressive in their investment approach," he said.

They are concerned about inflation and their higher living expenses.

"There's a lot of activity going into income and dividend stocks," he added.

pre

PREVIOUS STORY
Librarians can help readers grappling with info overload

divider