Guangzhou Part 4 - Cost of Living

While travelling to Xin Hui, the driver had asked me a hypothetical question, "would it better if my ancestor had not travelled to Singapore and we had stayed in China?"  My immediate reply was that many Chinese currently are requesting for immigration to overseas, among other countries, Singapore. There must be reason for this. Firstly, it is because of the education system which enable Singaporeans to be taught in both English (the commercial language) and a mother tongue. Secondly, the ability of Singaporeans to travel easily without the need of a Visa, which includes countries in the Euro zone and the US.

It sets me into deeper thought on what would I be if I were to be in China, perhaps a small business man, a farmer, an office worker? Would I enjoy the same convenience and wealth as a Chinese or Singaporean? Of course, my deeper concern is the need to go through the Cultural Revolution in the 1970s, although Guangzhou area would not be so severely affected.

羊城晚报 Article

It also sets me thinking on the cost of living in China, specifically in big city like Guangzhou. I had specifically brought back this article from the local newspaper, 羊城晚报, dated 7 July 2016. In the article, a reader had asked for advice for purchase of property. She shared that she is earning a monthly salary of about 7000 RMB (about S$1400) and she is approaching 30 years old soon. She is asking what value of property can she purchase assuming that she has a saving and parental contribution of about 700,000 RMB (about S$145,800). The newspaper expert advised that the value of property that she can purchase is about 1,100,000 RMB (about S$229,000). A $1.1 million RMB unit is only about 50 to 60 sqm.  For bigger area of more than 90 sqm, the cost can be in excess of $2 million RMB (about S$416,000). See photo from a property agent.

From a simple mathematical ratio, a Guangzhou resident needs $1.1million/7000 = 157 months of salary to purchase a property. Comparatively, a Singaporean (single and about same age) needs $300,000/4000 = 75 months. It is less stressful for the Singaporean to purchase a government subsidized public housing of about 90sqm. Both Singapore and China(Guangzhou) has a Central Provident Fund system which allows residents to make use of the fund to partially pay for the purchase of the property.

Secondly, the cost of meal in Guangzhou is between 10 to 20 RMB. While in Singapore, a hawker centre meal will be between S$3 to S$5. Comparatively, it is still cheaper to eat in Singapore.

However, the killer expenditure in Singapore is private transport. The purchase of a car will set the comparative advantage back.

The driver and I subsequently discussed the topic of retirement. For that, I would think China, especially the third or fourth liner cities and suburb would offer much better lifestyle for retirement. The driver shared that he could retire in the suburb of the city of his birth, Si Chuan with a big house and a garden to grow crops of his own desire. He shared that the house has 10 rooms. Whenever, there is an urge to visit the city, he could just drive and purchase things that he needs. I agreed.