From 1991 to 1995, one of the most popular children's programs on PBS was called "Where in the World Is Carmen Sandiego?"
The show, based on the "Carmen Sandiego" computer game series created by Brøderbund Software, helped children learn geography by following Carmen and her henchmen around the world. But no one in Carmen's world had to worry about the cost of living, a steady paycheck or how much rental units cost in any location.
Fast forward to 2016, where renters are finding that their monthly rent can cost a significant portion of their paychecks, depending on where they live. According to the Global Cities Business Alliance, in Boston, a worker on an average wage will have to pay 29.8% of earnings on rental costs every month. Even though housing in Mexico City is far cheaper, income levels are also much lower, the report notes, with workers earning an average salary paying 58% of it towards their accommodations.
China is perceived by many as an economic powerhouse, driving demand for material goods around the world. However, rental costs in Beijing are 1.2 times higher than monthly wages. This means that somebody earning an average salary in China's capital cannot live alone in typical city accommodations. Employer-secured housing does alleviate this problem in some cases.
The cost of housing has a ripple effect on everything else renters buy, including insurance, furniture, motor vehicles and even groceries or restaurant meals.
The following chart shows annual normal rent as a percentage of net earnings in 2015 in several major cities around the world. Despite what Americans think, our cities are not the worst on the list.
(Click on chart to enlarge.)
(Source: Statista.)
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