City residents pay more for everything from a gallon of gas to the rent on their apartments, thanks to the area’s packed-to-the-gills real estate, shifting demographics and sky-high taxes, experts said.
Nearly half admitted in a recent poll that they can’t afford to live anywhere in the state and might be forced to seek greener economic pastures elsewhere — and public policy experts say it’s a confluence of factors that’s the root cause.
“It’s all about the location,” said Sewin Chan, an economist and associate professor of public policy at NYU. “If the land and the property values are higher in Manhattan, a gallon of milk is just going to cost more here than in the middle of the country.”
That’s because the higher the rent for your local bodega, the higher the return they need to make ends meet, Chan explained.
That simple math bears out in New Yorkers paying $4.43 for a gallon of milk, or 42 percent more than the national average; $3.46 for a loaf of bread, which is 47 percent more; and $3.55 for a dozen eggs, or 55 percent more.
“Part of what you’re buying is not just the gallon of milk, it’s the storage, the retail facility it’s going to be in,” Chan said.
The same principle extends to residential space, where the available housing stock can’t keep pace with demand from increasingly affluent job-hunters flocking from other states — to the detriment of longtime New Yorkers, Chan said.
“With a city like New York, it’s mostly going to be demand-driven,” she said. “There’s not a lot of new supply, and people want to live in New York.”
That demand is driving up rent — and driving out lower-income residents in droves.
Also in play are prohibitive taxes, said E.J. McMahon, a researcher at the Empire Center for Public Policy.
“The property tax is a major portion of the rent tenants pay,” said McMahon. “The sales tax is high. It all drives up the cost of living.”
Heavy taxes also run up prices at the pump, where New Yorkers pay $3.05 per gallon, or 12.5 percent more than the national average.
Of that $3.05, more than 44 cents goes toward state taxes and fees — the fifth-highest amount of any state, and nearly 11 cents more than the national average, according to American Petroleum Institute statistics current as of Jan. 1.
Squeezed out by fierce competition for a largely static amount of space, more and more New Yorkers are thinking about moving somewhere more affordable.
But still, “people want to live in New York,” Chan said. “This is not going away.”
FAQs
The cost of living in New York City, NY is 38% higher than the state average and 76% higher than the national average. New York City, NY housing is 236% more expensive than the U.S average, while utilities are about 2% pricier.
Is NYC or LA more expensive? ›
Cost & Prices
When comparing costs and prices in LA and NYC, we can start with the fact that NYC is listed as the #1 most expensive city in the US and LA is listed as #9 out of 10. Housing – Apartments in LA are larger and cost less than those in Manhattan.
What salary do you need to live in NYC? ›
Researchers say a single adult needs to make more than $138,000, or an hourly wage of $66.62, to live comfortably while a family of 4 needs more than $318,000. According to Smart Asset, to cover necessities as a single person in New York City, you'll need an estimated $70,000 in wages.
Why is rent so high in NYC? ›
Part of the reason rents remain so high is because mortgage rates remain elevated, keeping some people in the rental market rather than buying a home. “The pressure on mortgage rates is still there,” said Miller.
Is $100,000 good in New York? ›
100K doesn't go very far in New York City
But if you live and work in the tri-state, that salary doesn't go very far. "I think for New York City a hundred grand would make you pretty poor," said Parul Jain, an associate professor of finance and economics at Rutgers Business School.
What is a realistic budget for NYC? ›
Cost of living in NYC broken down
Depending on your lifestyle, your living expenses in New York will vary. But overall, the cost of living in New York for a single person is $4,130. Whereas the average cost of living in NYC per month for a family of 4 is around $8,925 (renting a 2-bedroom apartment).
Is it safer to live in LA or NYC? ›
New York City has a higher safety index and better career opportunities. However, it has a higher cost of living and a smaller land size too. Los Angeles, on the other hand, has a lower cost of living with a more comfortable and stable climate. The city also has an affordable transport system.
Do more celebrities live in NYC or LA? ›
Many actors, musicians, directors, and industry professionals choose to make Los Angeles their base due to the numerous studios, production companies, and networking opportunities available.
Is $300,000 enough to live in NYC? ›
New York City residents need to earn at least $312,000 to get that six-figure feel. The nation's most populous city requires a lot of resources to maintain and upgrade its infrastructure and meet the demands of roughly 8.5 million residents and 61 million projected tourists for 2023.
Is 75k a good salary for a single person in NYC? ›
With a salary of $75,000 a year, you can live comfortably in New York. For a single person living in Brooklyn, a rough monthly budget would look like this: Housing. You can consider renting a shared room with one roommate for $950 per month or renting a studio apartment for $3,000.
We've identified 10 cities where the typical salary for a 150K job is above the average in New York. Topping the list is Northwest Ithaca, with Manhattan and New York City close behind in second and third.
Will NYC rent ever go down? ›
(NerdWallet) – An ongoing boom in apartment construction has helped slow down rental inflation — but renters shouldn't expect prices to drop dramatically from their pandemic-padded highs. That means affordability will remain the dominant narrative in rental housing in 2024.
Is rent in NYC crazy? ›
In America's most expensive cities, the sticker shock is especially bad. While the national median rent for a 1-bedroom is $1,487 per month, that figure skyrockets to $4,280 in New York and $2,300 in Los Angeles, according to a recent report by Zumper, a real estate data site.
Are people moving back to NYC? ›
People moving to New York are younger, make slightly more, and rent more than those leaving. 545,600 people moved from New York between 2021 and 2022, while 301,500 people moved into New York. New York City's population declined by almost half a million between 2020 and 2022.
Is NYC officially the most expensive city in the world? ›
New York, Los Angeles and San Francisco are among the top 10 most expensive cities on the planet to live in, according to the Economist Intelligence Unit's Worldwide Cost of Living 2023 report. Last year, New York City tied with Singapore as the most expensive city in the world.
Is New York now the most expensive? ›
The New York City Borough Beats Out High-Cost Markets San Francisco, Los Angeles and Seattle. August 29, 2023 | 4:04 P.M. New York City's Manhattan borough is the most expensive place to live in the United States, a new report shows.
How much more expensive is food in NYC? ›
According to Numbeo.com data from March 2022, groceries in New York City usually cost about $486.71 a month, per person. For the U.S. as a whole, the average is $348.34.
How much money do you need to be happy in New York City? ›
A single adult living in New York City would need to make $138,570 a year in order to live comfortably, according to the study. That equates to an hourly wage of $66.62. To cover the cost of just necessities as a single person in New York City, you would need to make an estimated $70,000, according to SmartAsset.
