No matter how many movies you've seen with the New York skyline in the background, it's hard to get over the magic of the city. Whether you're a born-and-raised New Yorker or you're dreaming of moving to the Big Apple, it's no secret that the cost of living in New York is high.
Calling New York an expensive city is an understatement. The overall cost of living index is 137.8 percent above the national average. This is the highest in the country. It means the average price of almost everything will be higher, and it could be challenging to try and save money if you're living on a tight budget.
Nearby cities will offer many price breaks, but many New Yorkers need to call at least one of the five boroughs home. So, let's crunch some numbers and see what it's really going to cost you to live in this most expensive city.
- Housing prices
- Food prices
- Utility prices
- Transportation prices
- Healthcare prices
- Goods and services prices
- Tax rates
- How much do you need to earn to live in New York City?
New York City housing prices
Between broker's fees, rent-controlled apartments and often unregulated landlords, finding somewhere to live in New York can sometimes feel like a full-time job. Then, there's also the monthly cost of having an N.Y.C. mailing address. Housing costs are 382.7 percent above the national average. None of the other big cities across the country even come close to this rate, adding hugely to the cost of living in New York.
Generally considered too high to live alone as a single person, rents in New York almost always make it necessary to have at least one roommate. One-bedroom rents in New York are up 18 percent over last year with an average monthly rent of $5,014.
Home prices are holding steady from last year, and the median price in New York is $816,500. Homes aren't on the market for too long, nor are they flying off the shelves. The median days on market is 49, about a month and a half.
New York City's prices by neighborhood
One of the best ways to potentially lower the cost of living in New York is by selecting what neighborhood you live in. Not all of them carry such a high price, and N.Y.C. residents know where to look.
Although neighborhoods like Chelsea ($7,049) and SoHo ($5,900) knock many people out of the running with such high one-bedroom rents, New Yorkers can catch a break in Harlem ($2,575) or even Queens ($1,900).
Other New York neighborhoods definitely have lower rents, but you need to compare the cost with safety and local amenities to ultimately find the best place to call home.
New York City food prices
New York has some of the best chefs in the world serving delectable food in everything from a deli to a high-end restaurant. Even on the lower end of dining, food is more expensive when eating out, adding to the cost of living in New York.
Groceries in N.Y.C. are also on the high end of the spectrum at 44.4 percent above the national average. This is significantly higher than in both Queens and Brooklyn which are both right nearby. A steak from a Manhattan grocery store will cost $15.76 per pound versus the same steak in Austin, which is only $10.63. Expect to pay $2.77 for a dozen New York eggs and $4.43 for a loaf of bread in the city, as well.
New York City utility prices
Weather in N.Y.C. is an exercise in extremes. Winters throughout the five boroughs get cold. Average lows can drop to 26 degrees Fahrenheit. Summers, as highs slowly creep up into the 80s, send city dwellers on the hunt for at least one AC window unit.
Fortunately, utilities in New York are only 3.3 percent above the national average. For energy costs, most residents see a bill of around $181.50 per month. This is similar to what you'd find in places like Colorado Springs or Portland, OR, but less than costs in nearby Brooklyn.
New York City transportation prices
New York City public transit is an iconic part of N.Y.C. The subway (regardless of how you feel about maintenance and delays) does go everywhere, allowing residents to forgo a car and save on transportation expenses. The New York cost for transportation lands 17.6 percent above the national average, a decrease of 11.6 percent over last year.
The average car commute for a New Yorker is 40 minutes, according to a recent study. That's not so bad for city dwellers who can't avoid driving a car, but you'll also have to factor parking into your budget. Meters across the five boroughs have hourly rates that range from $1.25 to $7.50.
You can opt to navigate the perfect grid that is New York City by foot or bike as an alternative. The city has a walk score of 99, and if you prefer two-wheels, N.Y.C.'s bike score is 86. There's also plenty of infrastructure for this mode of transportation.
Taking the subway (or bus)
When you're ready to forgo a car and pay for public transportation in the city, you'll ride the MTA. This includes both bus and subway services.
New York has a 100 transit score, thanks to the MTA. The base fare for both buses and the subway is $2.75, however, you can save some money by getting an unlimited MetroCard. This lets you swipe your card as many times as you want within a certain period. A 7-day unlimited pass is $33, and a 30-day unlimited pass is $127.
New York City healthcare prices
Between insurance, pre-existing conditions and changing prescription prices, it's hard to navigate the healthcare system — no matter what state in America you're in.
In Manhattan, though, you have access to more than a handful of hospitals depending on where you're located in the city. N.Y.C. hospitals include Mount Sinai, New York-Presbyterian and Lenox Hill, among others.
The cost of living in New York for healthcare is about 7.9 percent above the national average. A doctor's visit will set you back $112.50 on average, while a prescription drug, without insurance, costs upward of $435.12.
These prices and rates are similar to other expensive cities in the country but more affordable than you'd think. For example, Manhattan doctors' prices are $70 less than a visit in Boston and almost $65 less than in San Francisco.
New York City goods and services prices
New York City is 33.1 percent above the national average when it comes to goods and services. This category includes all the entertainment costs you put into your monthly budget, as well as certain things you enjoy doing, but could live without.
Meeting friends at the movies? Grab a movie ticket for $17.92 before heading out to pay an average of $13.59 for a New York-style pizza with your besties.
If you're into yoga, a class costs $26.88 on average. Luckily, you can also get in your steps on the way there and back, thanks to the city's walkability.
If these prices feel high bring your estimated monthly costs down with some free fun in the New York metro area. Enjoy a long walk through Central Park or along the High Line with friends both human and canine alike. This is something you can't do in other cities and it won't cost you a single cent.
Just remember, the cost of living here is high — you're in one of the most expensive cities — and in order to save some money, cutting back on items within this category is probably the easiest thing to do.
Taxes in New York City
Looking at taxes is never a fun thing. This goes for calculating income tax, paying property taxes and even thinking about sales tax while you're shopping.
In New York state, the sales tax rate is 4 percent. Localities are able to add their own percentages, though, so in New York City itself, sales tax is 8.875 percent. This means for every $1,000 you spend shopping, you pay $88.75 in taxes alone.
Income tax gets handled a little differently in N.Y.C. The city itself has its own local income tax on top of the state tax. This isn't often how it's done, but the city rate you'll pay varies by income from 3.078 percent to 3.876 percent. This gets added to your state income tax rate which will be somewhere between 4 percent and 8.82 percent. This percentage could get high as your salary goes up.
How much do I need to earn to live in New York City?
If you follow the advice of most financial experts, you should spend around 30 percent of your salary on rent. Taking into account that an average one-bedroom in the city costs $4,908 in monthly rent, if you wanted to pay the price for living alone, you'd need to make almost $200,000 a year to spend the suggested amount on rent.
That's really not so easy to do. Even in N.Y.C., a starting salary is much lower, and the median household income in Manhattan is significantly below this estimated salary at $67,046.
To save money on housing, and give yourself more options, you can calculate your budget more exactly with our rent calculator. You should also consider bringing in a roommate (or two) and looking at living slightly outside of Manhattan where the cost of living overall is often lower.
Living in New York
From Broadway plays to picnics in Central Park and a city where you literally have everything within reach, New York City is where it's at. Every single one of these amenities balances out the high cost of living in New York and makes it worth calling such an expensive place home.
As Frank Sinatra sang, if you can make it here, you'll make it anywhere. All you have to do is figure out if you can afford it.