Depending on where you live and how much money you make, some parts of the United States can be expensive when it comes to cost of living.
A $100,000 salary won’t go as far in Los Angeles as it will in Dallas, for example. Start with the fact Texas has no state income tax while California has some of the highest tax rates in the nation.
What makes certain cities so expensive? There are numerous factors which come into play. Let’s take a look at five cities in the United States and examine some common themes.
1. New York
The Big Apple, the financial institution of the world, the town so nice they named it twice… these are common nicknames and descriptions for the city. It is an expensive city to visit, with some of the highest hotel rates in the nation. Try finding a hotel in Manhattan for less than $150 a night. Now try living there.
Supply and demand for New York rental and living properties is at a standstill. There isn’t much room for growth. Combine that with high utility costs, a lower minimum wage and higher food prices and it’s easy to see why New York takes a bigger bite out of wages.
New York is a state that lets residents go online to shop for competing utilities. The Energy rates New York has to offer can be less of a burden on your pocketbook if you look around for the right price.
New York has a personal income tax of between 2.5 and 3.5 percent, depending on how much you make, and the state tax is 4 percent in most areas. That makes New York City one of the most expensive places.
2. San Francisco
Believe it or not, there may be one city more expensive than New York. In this case, it has to do with rent.
Rents in the Golden Gate city are the highest in the nation. Strict zoning laws and building codes limit the amount of space available for apartments. This results in prices for your average two-bedroom apartment zooming up to a shade over $1,900 a month. At this rate, you will need a rich government or financial job to afford those prices.
Jobs in high-tech are also prevalent out here, driving up salaries north of $75,000 a year. Apartment owners that are savvy to what people make in California can charge high rents accordingly. Combine this with some of the highest gas prices in the nation (over $5 a gallon in high-demand times) and it is easy to see what makes San Francisco a great place to visit but a headache to live in.
Sure, a visit to Hawaii is enough to make someone swoon, but try living in the 50th state. The answer is simple why Honolulu is expensive.
Most prime rental and housing property has a great view of water and beaches, specifically Waikiki Beach, the most well-known beach in all of Hawaii. Because fuel, food and other daily staples have to be shipped in from the mainland, it results in higher prices for all of these items. The irony is Hawaii has some of the lowest tax rates in the nation, thanks to all of that tourism.
4. Los Angeles
Gridlock on the freeways, the need for insurance on homes in the event of an earthquake… all of the taxes common to San Francisco… the combined Los Angeles-Orange County area has gained a reputation as a great place to visit.
It can be a great place to live as well, but its freeway system and drawn-out size (just how big is the metro area, anyway?) mean travel from north to south or east to west can cost time and money… not to mention lots of gasoline.
If you can find a job in the movie or TV industry chances are it pays pretty well, but look out for jobs in other fields. If you’re a struggling actor or new to the job market, chances are your salary won’t go very far in this city.
Expensive Ivy League schools and large financial corporations make their home in this big Massachusetts metro market. They do not call this state “Taxachusetts” for nothing.
Rents for one-bedroom apartments often rise above $1,000 a month in this market, and long commutes to avoid high rents often chew up valuable gas and time spent on the roads. If you live in the central city, rents or housing rates can go even higher.
Urban renewal projects throughout the city have torn down older properties in favor of newer, pricier houses.