The great capital cities of the world such as London, Paris, New York and Hong Kong have long been a draw for expats and some are becoming cheaper to live and work in.

London has retained its place as the world’s most expensive city for businesses to accommodate their employees, but is beginning to look better value on a world stage as Hong Kong and New York close the price gap, according to latest analysis from international real estate advisor Savills.

These three cities have dominated the Savills Live/Work Index since its launch in 2008 and form a tight group of world class cities where it now costs over US$110,000 per employee per year to rent typical office and living space.

US dollar appreciation means non-dollar denominated cities now represent better value to international businesses, the index points out.

By contrast, a strong economic recovery and rising commercial and residential rents are combining with the strong dollar to make North America an ever more expensive yet attractive base for business. San Francisco has outpaced all other cities in the live/work index, with growth in rent and other real estate costs of 55.1% since 2008.

London is now 7.3% cheaper in dollar terms than in June 2014, while fourth placed Paris has slipped below the US$100,000 per employee threshold for the first time since the middle of 2012 thanks to the triple whammy of rental falls, dollar appreciation and euro weakness.

The plummeting rouble has demoted Moscow from seventh place in the Savills world city rankings, with total live/work costs now less than half that of London, Hong Kong and New York, at US$ 53,163 per person, a fall of 24.6% since the middle of 2014 in dollar terms.

The analysis points out that further rent falls and currency weakness could push the Russian capital down closer to emerging Asian powerhouse, Shanghai.

It also says that US real estate is the focus of increasing international investor interest. To explore this phenomenon, Savills has introduced multiple North American cities to its index this year. They have compared the costs of living and working space in San Francisco, Los Angeles, Miami and Chicago with their core list of 12 leading world cities.

San Francisco claims fifth place in the world city ranking ahead of Singapore, confirming its status as a world class city despite its relatively small population and revealing the importance of the digital and creative economies in US economic growth.

All five of the US cities rank ahead of Shanghai, Mumbai and Rio de Janeiro on the basis of live and work costs. They have also together shown higher combined office and residential rental growth since December 2013 than the core 12 cities, propelled by US Corporate recovery as well as tech and creative industry expansion.

‘San Francisco, Los Angeles, Miami and Chicago continue to represent good value for occupiers on the world stage,’ says Yolande Barnes, director of Savills World Research.

‘However, along with New York, these cities have much greater head room for rental growth in the near term than many more established world cities thanks to their cheaper starting base, the scale of US economic recovery and recently low levels of new supply,’ she added.