The capital was approximately 0.95 percent more expensive to live in than HCMC in 2020, according to the Spatial Cost of Living Index compiled by the General Statistics Office (GSO), which measures the relative cost of living in different regions and communities.

In order to rank the cost of living in different localities in Vietnam, the costs in each locality was compared to that of Hanoi, keeping the cost of living in the capital city as 100 percent. HCMC came closely after at 99.05 percent.

In terms of education fees, HCMC was more expensive than Hanoi with tuition in private schools and vocational schools 5.43 percentage points higher than those in the capital city, GSO said.

However, HCMC was cheaper than Hanoi in food and beverage services, medicines, transportation and entertainment.

The northern port city of Hai Phong was the third most costly locality in Vietnam, rising six places from 2019. Its economic growth has led to higher service prices than other localities, the GSO report said.

Da Nang came fourth, followed by the northern mountainous province of Lao Cai, home to the popular resort town Sa Pa.

Hau Giang Province in the Mekong Delta was the cheapest place to live in, with its cost of living 10.32 percentage points lower than in Hanoi.

The central province of Thua Thien Hue, home to former citadel Hue, slid from sixth position in 2019 to 14th last year due to discounted fees for entertainment and tourism services as also house rents, because of Covid-19 impacts.

The GSO report said several localities in the mountainous areas of northern Vietnam have seen a drop in living costs in recent years thanks to the increasingly convenient transportation.

HCMC, Da Nang and Hanoi are among Southeast Asia's 20 most expensive cities, according to data released earlier this year by user-contributed database Numbeo.

It estimated the average monthly expenses for a single person, excluding rent, at $469, $445 and $438 in HCMC, Da Nang and Hanoi, respectively.