London leapfrogged by NYC as world's most expensive city

The aftershocks of the UK's decision to leave the European Union has led to New York and Hong Kong overtaking London at the top of the world's most expensive cities.

In a list compiled by property broker Savills, the company's research focuses on the cost of living in rented housing and working in an office for a year.

The English capital was top of the pile for about two and a half years due to the booming value of property, but the impact of the fall in sterling and less demand for real estate has saw it lose its place.

"Brexit has made London more competitive, at least in terms of cost,” said Yolande Barnes, head of world research at Savills. “Of course, other factors might mean it won’t be.”

Total costs for an employee in London fell 11% to $100,141, while New York increased its average to $114,010, and Hong Kong to $100,984 to pip second place.

One of the biggest movers compiled by the research was Tokyo, who climbed to fourth spot with a 22% rise in rental costs.

The Savills research focused on accommodation costs for employees in financial-services and creative industries, which are major drivers of the economies of global cities, Ms. Barnes said.

The UK voted to leave Europe in a historic refrendum on June 23, causing significant market volatility and a steep fall in the value of the pound.