Cost of Living

What is the cost of living in South Africa?

No doubt you would like to try to estimate how far your rand will stretch and how much money (if any) you will have left after paying your bills.

Anyone planning to live in South Africa, particularly retirees, should take care not to underestimate the cost of living, which has increased considerably in the last decade. South Africa isn’t a cheap destination any more, particularly following property price increases in the 21st century and the strengthening of the rand, although there’s a huge disparity between the cost and standard of living in the prosperous regions and those in the poor areas: the former is First World, the latter Third World (or, to use the politically-correct terms, the former is Developed World, the latter Developing World). Inflation was currently running at almost 10 per cent in 2003 but it has been significantly reduced and a rate of 5 per cent is expected for 2005.

The cost of living in the popular (with expatriates) parts of South Africa’s major cities is much the same as in cities in Australia, France, Germany, the UK and the US. Luxury and quality products are expensive, but wine and spirits are relatively inexpensive, as is dining out, although there are fears that the steep price rises seen in some restaurants and hotels over the last couple of years will deter tourists from visiting South Africa. (An investigation by the Congress of South African Trade Unions, fearful of job losses among its members if visitor numbers decline, identified 40 per cent price increases in 2004 among some businesses in the tourist sector, but these are the exception.)

Food costs slightly less in South Africa than it does in the UK but prices are similar overall to those in most other western European countries, although you may need to modify your diet. A budget of R2,000 to R3,000 (£175 to £260) feeds two adults well for a month, excluding fillet steak, caviar and alcohol (other than a moderate amount of inexpensive beer or wine). On the other hand, it’s possible to live frugally in South Africa if you’re willing to forego luxuries and ‘live off the land’. Shopping for selected ‘luxury’ items (such as stereo equipment, electrical and electronic goods, computers and photographic equipment) abroad can also yield savings.

Overall, it’s difficult to calculate an average cost of living in South Africa, as it depends on an individual’s circumstances and lifestyle. A list of the approximate minimum monthly major expenses for an average single person, couple and family of four is shown in the table below. If you work in South Africa, you need to deduct the appropriate percentage of your salary for income tax and social security contributions. The numbers in brackets refer to the notes following the table.

ITEM	MONTHLY COSTS (R)
	Single	Couple	Family Of Four
Housing (1)	3,500	4,500	6,000
Food (2)	1,750	2,500	4,000
Utilities (3)	300	400	700
Leisure (4)	800	1,250	2,000
Transport (5)	700	800	1,100
Insurance (6)	400	600	1,000
Clothing	300	600	1,200
Totals	7,750	10,650	16,000
	(£675)	(£925)	(£1,390)

1. Rent or mortgage payments for a modern or modernised apartment or house in an average suburb, excluding major cities and other high-cost areas. The properties envisaged are a studio or one-bedroom apartment for a single person, a two-bedroom property for a couple and a three-bedroom property for a family of four. 2. Doesn’t include luxuries or expensive alcoholic drinks. 3. Includes electricity, gas, water, telephone, pay (e.g. satellite) TV and heating costs. 4. Includes all entertainment, restaurant meals, sports and holiday expenses, plus newspapers and magazines. 5. Includes running costs for an average family car, plus third party insurance, annual taxes, petrol, servicing and repairs, but excludes depreciation or credit purchase costs. 6. Includes ‘voluntary’ insurance such as supplementary health insurance, household, third party liability, travel, car breakdown and life insurance.