Update If you are looking for Shanghai Weather, please visit Shanghai Weather (TQ) June 24, 2004

Yesterday, I received an email from Raz, discussing about the living cost in Shanghai.

I’m mostly interested in the living costs in Shanghai…what normal salaries are and the rent for a small apartment in the city. Also how mush does it cost to buy stuff…a pc, a bigmac, local food and transport??

/ Raz

Very interesting topic, isn’t it?

It is hard to tell

Shanghai is among the top 10 cities for living cost in the world. Actually, it is the sixth expensive city for expatriates, according to CNN. But during my talk with some expiates in Shanghai, I found they think Shanghai is a heaven. This is partly because the pay for foreigners in Shanghai is much higher than that for local residents while the costs are almost the same.

I’d better start the topic with some prices of daily lives. I will RMB (Renminbi) as currency unless otherwise noted. Please keep in mind that 1 USD = 8.3 RMB.

Normal Salary

According to a goverment report, average worker’s monthly salary is 1492 RMB.

In 2001, Shanghai’s average worker’s salary was RMB17,910, making it number one in the 30 areas of China.

1492 RMB is a magic number and was used for many areas, such as the house fund deduction.

179 USD for one month? This number is astonishing for most people in U.S or Europe. Well, it is true. I told my friends just arriving in Shanghai that people feel happy if they get 400 RMB per month in my home town, they said “Oh, my god!!”.

Don’t get the wrong impression. For undergraduates of computer major, their expectation for starting point salary is about 3000 RMB. Some can get 5000 to 7000 RMB, this will be a very good number. It is very common for employees in foreign companies to earn more than 10,000 RMB per month.

For foreigners, it is another story. The first question when they see a job advertisement is, “Is it local pay or U.S. pay?” This phenomenon is interesting. For local pay, they get RMB and although it is still very high (4000 ~ 12000 RMB? I **guess**), but for U.S. payees, they get a package that is attractive even in U.S. You know the payment level.

Rent for a small house

It depends. Apartments with different size, different area, different decoration style and different environment may vary greatly in price.

I once was living in a rented apartment for 600 RMB per month. It has two bed rooms and one living room – 68 square meters.

Now, I moved into the new apartment I bought. It is rented at price from 3000 – 4000 RMB. For an apartment of 120 sq. meters in Gubei, the area where expatiates gathers, costs about 10,000 RMB per month for rent.

To buy an apartment will cost you a lot. It is more expensive than a house in U.S. Average price is about 5000 RMB per sq. m. in urban areas. The price for some downtown areas will be about 9,000 ~ 10,000 RMB per sq. m.

Other prices

Personal Computer: 3000 RMB can buy a computer that can run. 6000 RMB will get a powerful computer. Seldom can I see a desktop computer more expensive than 10,000 RMB.

Big Mac: 10 RMB. McDonald’s and KFC can be seen everywhere. KFC has opened 60 stores in Shanghai. There are four KFC, 1 McDonald’s, and two PizzaHut within a 500 meter area around the building I am working in. The price is low. 20-30 RMB will get a great meal there.

Local food: About 30 RMB per person will get very good food. There are lots of restaurant in the city. Normal dishes cost about 16 RMB, while some expensive one cost 40-60 RMB.

Transportation

This is the most easy one since the price is settled and consistent across the city.

Bus: 1 or 1.5 RMB for normal bus and 2 RMB for air-conditioned bus.

Taxi: 10 RMB staring price w/ 3 km and 2 RMB for each kilometer more.

Metro: 2 to 5 RMB depending on the distance. 3 RMB is the most common price.

Entertainment

Movies: about 25-30 RMB

Starbucks: 25 RMB for Cappuccino.

Beer in bars: 30 RMB

Updated

Thanks for Uday’s suggestion Here are more examples for the costs.

Medical expenses

Medicine is much lower than in U.S. It is an obvious evidence that medicines are on top of shopping list for most Chinese who returns to China for vacation. Here is some sample:

Berberine (100mg x 24 tablet): 3.3 RMB

Eyedrop (bottle): 5-10 RMB

Tylenol: Around 20 RMB

However, seeing a doctore costs much more. This is not because of the service charge of a doctore is high. On the contary, it is very low – around 8 RMB only. But the doctors tends to write you a prescription with only very high price medicines and much more than you need. This is bad actually, since the income of the doctor heavily depends on the medicine they “sell”.

Thus, typically, it costs about 100-150 RMB for the lightest fever or eye-ache. It cost much more if there is any serious illness. Medical insurance is defintely needed.

Education expenses

Collage tuition: Let’s take one of the most famous university Shanghai Jiaotong Univeristy (Chinese site) as an example. The tuition is 1500 RMB per year in 1995. Now it seems to be 6000 RMB.

After-work study: I mean some classes like guitar, music, Chinese language, driving and other specialty training typically cost about 800 RMB to 4000 RMB per term. A typical term is about 2 weeks (daily class), or two month (weekend class)

Professional training: This type of training means you attend the professional training provide to company like “Communication Skills”, “Sales skills” – it usually costs 1000-2000 RMB per day.

insurance: It really depends on the insurance company and the plan you are using – even the insurance agent need to calculate and give you a number. To give you some idea, I have talked with a life insurance agent and she wants me to pay 1000 RMB per month for 30 years. I forget about coverage since I didn’t buy it at last.

Income tax structure for expats

According to the last regulation (Chinese site)

Monthly income:

<500 5% 500-2000 10% 2000-5000 15% 5,000-20,000 20% 20,000-40,000 25% 40,000-60,000 30% 60,000-80,000 35% 80,000-100,000 40% >100,000 45%

Conclusion

Shanghai’s cost is still very low compared to that in U.S. It is really a heaven for expatiates. Experience it by yourselves.

See also

• Continue to read part II of this article on Houses and Cars – Living Cost in Shanghai – Part II
• Shanghaiexpat.com, resource for expats in Shanghai
• My page for Shanghai

Update January 30, 2004

In response to Mr. Tan’s question, I added more items to the price list.

Estimate cost for each item below (in US Dollars):

– monthly rent for apartment (fairly new and near town with at least 3 bedrooms)

Wow. That is high above average living standard in Shanghai. So I would say, it should be 5000 RMB (600 USD) or higher for downtown area (inside the Inner Ring Elevated Road. In any area that can be described by any of the following term: decent, graceful, historical, very modern, etc, it should be above 4000 RMB (480 USD) for a apartment of 3 bedrooms. Of cause you can get an apartment of one bed room at around 1500 RMB (180 USD) in downtown or a three bed-room apartment that is far from downtown (but near Metro) at around 2500 RMB (300 USD). Check my articles under Real Estate category for more information on housing.

– monthly international school fees for 2 children (both 8 years old)

The fee varies greatly. Here is the phone list (Chinese page) of international schools in Shanghai. For example, Shanghai Singapore International School offers Singapore – based curriculum and faculty.

– estimate monthly transport for 4 persons

If you take metro only – which is very convenient, it is 4 RMB (0.5 USD) per person and 4 persons make up of 480 RMB (60 USD). If you take taxi, 200 RMB (25 USD)/person should be enough if you live in down town.

– estimate monthly food allowance for 4 persons

I checked with my mom and she said if every day, you cook by yourself and eat at home, 400 RMB (50 USD) should be enough for four people family. If you go to restaurant, 50 RMB (6 USD) per person is the common price for low end restaurant. 100 RMB (12 USD) per person is already very decent(expensive) restaurant.

Again, any estimation varies so greatly depending on your own standard of living.