San Diego is Climbing the Ranks of Most Expensive Cities in the World. Here's Why

San Diego is shooting up the ranks of the most expensive cities in the world, according to the Economist Intelligence Unit's 2022 Worldwide Cost of Living (WCOL) survey.

The twice-yearly survey details how inflation is impacting prices across the globe, and it highlights how the cost of living in America's Finest City is rising alarmingly fast.

San Diego rose 33 slots to number 17 in the latest ranking — that's not quite as high as its California neighbors Los Angels (#4) or San Francisco (#8), but it's worse than major cities like Boston (#21), and Tokyo, Japan, and Moscow, Russia (tied at 37).

WCOL data is collected every March and September and surveys are released in June and December. In the June 2022 WCOL, San Diego was ranked 50. Its 33-spot increase is good for the 6th-quickest rise among 172 cities surveyed.

The top 10 biggest movers look like this:

City	Rank	Upward Move
Moscow, Russia	37	88
St Petersburg, Russia	73	70
Atlanta, US	46	42
Charlotte, US	53	39
Indianapolis, US	53	35
San Diego, US	17	33
Mexico City, Mexico	43	33
Saipan, Northern Mariana Islands	46	30
Portland, US	46	30
Boston, US	21	29

So, what's behind that rapid ascent?

"San Diego became a destination for a lot of people with resources," explained UC San Diego marketing professor On Amir.

Prices across the globe have risen by an average of 8.1% over the last year, according to the survey, which is the fastest rate for at least 20 years. The survey said the cost of living, in general, is being driven up by increases in fuel and energy costs, which have been helped along by the war in Ukraine and COVID-19 restrictions in China.

But the coronavirus pandemic jumpstarted the cost of living spike here in San Diego in a different way, according to Amir.

"We saw some migration down from the Bay Area where people said, 'Oh, I don't have to be here all of the time. I don't have to deal with this cost of living. Let's move down the coast to a place that's very similar and a 45-minute Southwest flight away if I need to, but I can afford a larger place with good schools," Amir said.

Remote work also played a role.

"Let's say it weakened the relationship between the location you live in and the location you work in," he added.

The good news, according to the survey and Amir, is that price increases and inflation are expected to slow in 2023.

"I don't expect to see as steep a climb continuing to happen," Amir said.

"Supply-chain blockages should also start to ease as freight rates come down and demand softens. Unless the war in Ukraine escalates, we predict that commodity prices for energy, food and for supplies such as metals are likely to fall sharply in 2023 compared with 2022 levels, although they are likely to stay higher than previous levels," the survey said.

The survey compares prices for more than 200 items and services in more than 170 cities. Colombo, Sri Lanka; Bangalore, India; Algiers, Algeria; and Chennai, India, are the four cheapest cities in the world, according to the survey.