Yes, the United States is huge. From Alaska nudging the Arctic sea to Florida dipping into the Caribbean, it spans 3.806 million square miles, making it the fourth largest country in the world after Russia, Canada, and China. And not only is the U.S. the proverbial melting pot, but it is also built of many different regions that became part of the country at different times and have extremely different cultural influences. While there is no easy answer to why the cost of living can vary so greatly in a single country, the size and diversity of the U.S. undoubtedly play a role. And cities with the best weather and the best opportunities will always have higher costs of living. Expenses in U.S. cities do no compare at a global scale, with the likes of Seoul, Hong Kong; Copenhagen, or Geneva, but living costs can still be burdensome.
Everyone knows that a decent salary in one state or city will leave you scrambling to pay rent or live comfortably in another. A two-bedroom, two-bathroom 1,500 square foot house on a quiet street can cost $100,000 in one city, and then the exact same house (same size, specs, and amenities) in another city and state may cost upwards of $500,000. For a bit of perspective, it costs 54% more to live in Honolulu than in Danville, Illinois. Here we are going to analyze the cities with the highest cost of living, and that includes Washington D.C.
Do you live in an expensive city? How much does it cost to rent an apartment or own a home, buy groceries, and have fun?
These states are ranked in order based on their overall cost of living. All 2015 cost of living data comes from Numbeo — a crowdsourced global database of reported consumer prices. Each index is weighted so that prices in New York City represent 100%. Therefore, if a city scores a 120 on the rent index, renting an apartment costs 20% more than in New York City. Additional data came from Zillow.com.
6. Washington D.C.
- Consumer Price Index: 96.02
- Rent Index: 69.88
- Groceries Index: 94.01
- Restaurant Index: 96.31
- Local Purchasing Power Index: 130.91
The nation’s capital is an expensive place to live. As we have reported before, to live comfortably in Washington D.C., residents need an annual salary of $108,092. And data from the Department of Labor’s Bureau of Labor Statistics even ranked the city the most expensive in the United States, although every other study picks New York City. The average house sells for $483,800, according to Zillow’s Home Value Index. By comparison, the average house price in the United States is $178,400.
5. Stamford, Conn.
- Consumer Price Index: 96.22
- Rent Index: 92.65
- Groceries Index: 108.93
- Restaurant Index: 90.06
- Local Purchasing Power Index: 127.65
Stamford may the smallest city, by population, on this list, but homes sell for an average price of $435,416, according to Zillow’s Home Value Index. And that is just one factor that shows how expensive it is to live in this city of 122,643. “Everything is high in Stamford, relatively speaking. It’s an upper class suburban community,” Dean Frutiger, project manager for the Cost of Living Index project at Council for Community and Economic Research, told ABC News back in 2012.
In Stamford, on average, you can buy a cappuccino for $3.70, an imported beer for $6, a gallon of regular milk for $8.43, a gallon of gas for $2.56, a one-way public transportation fare for $1.5o, a month of utilities for $176.75, and a 1-bedroom apartment in city center for $1,825.
4. San Francisco, Calif.
- Consumer Price Index: 97.00
- Rent Index: 96.07
- Groceries Index: 111.86
- Restaurant Index: 99.17
- Local Purchasing Power Index: 116.72
San Francisco is a beautiful city in which to live. Add to that its proximity to the booming technology industry centered in Silicon Valley just to the south, and San Francisco becomes a very popular city for those working in tech — at Apple, at Google, or at any number of start-ups and app developers. Because of San Francisco’s geography (the city is located on a peninsula) space is at a premium, and the influx of high-paying jobs means housing costs are skyrocketing.
Last year, the median price paid for a new or existing single-family home or condo in San Francisco hit $1 million for the first time, according to a report by DataQuick. While housing is actually slightly more affordable in in San Francisco than in Manhattan, Brooklyn, or Honolulu, transportation costs and health care come with bigger price tags. Gas averaged $3.82 per gallon, while a one-way public transportation ticket costs $2.25 — both above the national average.
3. Anchorage, Alaska
- Consumer Price Index: 99.75
- Rent Index: 39.98
- Groceries Index: 110.64
- Restaurant Index: 90.85
- Local Purchasing Power Index: 146.17
Ordinarily, New York and California dominate lists of the most expensive states in which to live. But Alaska, due to its remoteness and to burdensome heating costs during the winter, has very high costs of living. For example, in Anchorage you can expect to pay $70 or more for Internet (6 Mbps, Unlimited Data, Cable/ADSL), which is considerably higher than in the rest of the country. And monthly utilities run about $266.12.
On the plus side, home prices are lower. The average listing price for homes for sale in Anchorage was $386,882 in June.
2. New York, N.Y.
- Consumer Price Index: 100.00
- Rent Index: 100.00
- Groceries Index: 100.00
- Restaurant Index: 100.00
- Local Purchasing Power Index: 100.00
The high cost of living in New York City is hardly news. But the fact that expenses rose 23% between 2009 and 2014, according the Economist, means it is a serious problem. The shortage of affordable housing is a huge part of that. The average monthly rent in Manhattan reached a record $3,438 in 2014, while buying will cost you $555,700, according to the Zillow Home Value Index. A bottle of imported beer will cost you $7, well above the national average, while utilities run about $133.88 per month, also more than average. And a meal at an inexpensive restaurant will set you back $15.00.
New York City is not only a huge draw for those looking for success in the fashion, culinary, music, and financial industries, but also occupies an elephantine place in American popular culture, drawing thousands of new residents each year.
1. Honolulu, Hawaii
- Consumer Price Index: 104.23
- Rent Index: 64.92
- Groceries Index: 119.41
- Restaurant Index: 85.11
- Local Purchasing Power Index: 69.79
It should come at no surprise that the cost of living in paradise is steep.
Cities in Hawaii face a strong housing market, with the average home selling for $616,800, according to Zillow. But groceries are expensive as well, with milk running $6.54 a gallon and a dozen eggs costing $4.19 — both higher than the national average. “Honolulu food prices have gone up at a faster rate than the rest of the cities,” according Dean Frutiger of Council for Community and Economic Research, who believes this is tied to rising transportation costs. After all, Hawaii suffers from being an island.
But even if Hawaii’s capital has the highest cost of living, the state as a whole has topped lists of states with the best quality of life. And it is not just because of the beach and tropical flora and fauna. According to CNBC, the state stands out for its healthy residents.