How Expensive Is it to Live in New York City?
Life really does cost more in New York. To be precise, the cost of living in Manhattan was 148% higher than the average cost for major U.S. cities in 2019. Manhattan takes the number one spot as the most expensive, according to a Kiplinger survey. Brooklyn, which was treated separately in the study, came in as the fourth most expensive city at 80% above the average cost.
- The cost of living in Manhattan was 148% higher than the average cost for major U.S. cities in 2019.
- The average rent in Manhattan was $3,475 according to zillow.com while the rents averaged $2,900 per month in the rest of the city.
- It costs an average of $1,376 per square foot to buy a home in Manhattan and $673 per square foot for the rest of the city.
- Consumer prices are 24% higher while restaurant prices are 28% higher in New York City than in other cities such as Chicago.
Understanding How Expensive is New York City
Before moving to any city, the cost of living is a critical financial metric to know, which can include rent, mortgage, food, and utilities. In some cities, residents need a car while in other cities like New York, public transportation is the norm. However, if you're contemplating moving to the Big Apple, it's likely going to be a more expensive city than your current one.
Childcare is nearly double the cost of other cities such as Chicago and as any New Yorker can tell you, the worst of the price discrepancies between New York and other cities is the cost to buy a home. Below is an outline of how much it costs to live in New York City.
Renting an Apartment
You can pay $20,000 a month for a family-size apartment on the Upper East Side of Manhattan. Or, you can rent a tiny apartment in Queens for about $2,000, assuming it's not in one of the borough's new luxury buildings. Of course, there are many options in between, but finding a place to live in New York City is grueling for all but the super-rich with vacancy rates under 4% in 2019.
The average rent in Manhattan was $3,475 in 2019, according to zillow.com. The rents are slightly lower with an average of $2,900 per month throughout the rest of the Big Apple. Neither price will get you a palace since the average size of an apartment is approximately 700 square feet.
However, some good news for renters is that approximately 40% of the rental apartments in the city are rent-stabilized. In other words, landlords can't increase rents at will since rent increases are set by the Rent Guidelines Board of New York City.
Buying a Home
The cost of real estate in Manhattan averaged $1,376 per square foot in 2019, according to zillow.com. That's more than double the price per square foot of $673 for the rest of the city. By comparison, San Francisco had a price per square foot of $1,081 while Boston came in at $732, and Miami Beach was $498.
The median price of homes listed in Manhattan for 2019 was $1,495,000, while the median price of homes that sold was $968,000. In other words, not all of the homes are selling for their listing price, which could possibly be a sign that the housing market is cooling off. New York City, as a whole, had an average listing price of $779,000 per home.
The outer boroughs are no longer safe havens from Manhattan prices. The average home in Brooklyn cost $750,000 according to Zillow. In Queens, the average was $589,000, Staten Island was $579,000, and the Bronx averaged $385,000.
Consumer prices are 24% higher in New York City than in Chicago, according to numbeo.com. Groceries such as milk, eggs, cheese, and chicken are all at least 30% more expensive in New York versus Chicago.
It should be noted that such comparative statistics are subject to huge variations. You can find specials on anything in New York, and grocery shopping options range from farmer's markets to supermarket chains and convenience stores.
Restaurant prices are 28% higher in New York versus Chicago. However, the average costs of dining out in New York City are likely to be inaccurate since there are so many options in the city. At the low price end, the choices are nearly endless, from street food, and cheap eateries to modest family-owned restaurants of every ethnicity and specialty. At the high end, the prices can be jaw-dropping.
The statistics say that a three-course meal for two in a mid-range restaurant will set you back $80 in NYC and only $60 in Chicago–a 33% higher cost in New York. Sadly, even McDonald’s costs more in New York than in Chicago, by about 12% for a McMeal.
A single ticket fare for a New York subway or bus ride is $2.75, though regulars can buy a monthly pass for $116.50. Both are around 12% above Chicago’s fares.
Taxis start at $3.24 in Chicago versus only $2.50 in New York. Nevertheless, taxis tend to be an expensive option, at least during the weekdays when traffic is nearly always heavy.
One plus for New York City over many cities is that there's no need to own a car. Of course, considering that it averages $430 per month to rent a parking space in a garage, most people probably won't want a car. Public transportation or walking are likely the best ways to get around in the city, particularly considering the traffic.
Basic utilities for a 900 square-foot apartment (including electricity, heating, water, and garbage) in New York is approximately $128 per month, which is comparable to Chicago. Adding access to the internet will set you back another $65 in Chicago and $63 in New York.
Among American cities, only San Francisco comes close to New York in cost. However, a New Yorker has nearly 16% less purchasing power than someone living in San Francisco, which makes New York one of the top ten most expensive cities in the country.