The Cost of Living In New York

There are not many tourists who, after even a brief visit to the Big Apple, fail to fall in love with New York and start fantasizing about spending more time there. Who wouldn’t want to see a Broadway show “just because”, enjoy a day strolling nonchalantly in Central Park, or wander the streets of the City that Never Sleeps aimlessly, and without the pressures of the typical tourist agenda?

New York immediately accepts anyone and everyone; which is the simple reason why everyone likes to go there. As the famous Tom Wolfe quote goes, “One belongs to New York instantly, one belongs to it as much in five minutes as in five years.” That’s how it is. Nonetheless, can we even allow ourselves to feel this truth?

The Cost of Living in New York

When they hear about it, most people are shocked by the cost of living in New York. Elsewhere in the United States, the definition of  “middle class” is up for debate, with the Pew Charitable Trust saying it is a family income between $32,900 and $64,000 per year, the US Department of Commerce arguing between $50,800 and $122,000, and the US Census Bureau’s claiming between $20,600 and $102,000. According to the New York Times, however, $80,000 – $235,000 per year  is middle class—if you live in Manhattan.  Of course this means that anything below 80,000 is lower class – just a step away from poverty. $80,000 is $6,666 per month, so more than 5,000 Euros per month.

How is this possible?

Well, the average Manhattan apartment, at $3,973 per month, costs almost $2,800 more than the average rental nationwide, almost five times the national average. The average sale price of a home in Manhattan last year was $1.46 million, according to a recent Douglas Elliman report, while the average sale price for a home elsewhere in the United States was just under $230,000, less than 1/6th the price. This cost of living differential extends to other things as well, the price of a high school or grade school education (with only a few public schools worth attending) often exceeding $40,000 per year. Count extra taxes and the elevated price of food and other items, and someone making $70,000 per year in another part of the country would need to make $166,000 in Manhattan to enjoy the same purchasing power. (although certainly a much smaller apartmentt!)

Most researchers define the middle class by calculating the median income for a place, and grouping people into certain percentages above or below the absolute middle. But if you define it by lifestyle, a salary would have to fall between $80,000 and $235,000 to obtain a Manhattan lifestyle comparable to the US average for the middle class.

I’m not writing this to disparage life in New York, moving to Manhattan was the best decision I’ve ever made. But if you’re going to do it, get ready! Otherwise, enjoy your trip 😉

French, Spanish, Catalan

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6 Responses to The Cost of Living In New York

  1. Newell October 6, 2014 at 2:43 pm #

    I agree. You are leaving out many of the practical additional costs of living in NYC.

    For instance, if you buy a “house”, meaning apartment or condo, there is always a monthly maintenance fee which is typically quite high (many thousands / month). In addition, there is the NYC income tax, the NY State Income tax on top of the Federal Income tax and the NYC / NY State sales tax. For high earning people (generally anyone who can afford to own property in NYC), total tax rates of 70%+ is relatively normal unless you have exceptionally high percentage of capital gains income.

    The alternative is commuting to the suburbs of NY, NJ or Conn. which involves at least one or more hours each way, every day.

    • Erica October 9, 2014 at 12:30 pm #

      Thank you, Newell. Those are indeed big additional costs to take into account. For sure the most difficult part of living in New York is paying for your lifestyle, and the most difficult part of paying for your lifestyle is paying your rent/or your apartment. Check out this video for a creative solution that we posted in another article in this blog! You will see a small New York apartment transform into a gorgeous amazing loft!

  2. Arnaud July 14, 2015 at 10:05 pm #

    Bonjour Erica,

    Je viens de lire avec grand intérêt votre article sur le coût de la vie à New York. M’y trouvant actuellement pour deux mois pour un travail de recherche, je ne peux que constater quotidiennement le coût très élevé de la vie quotidienne.

    Les chiffres que vous avancez me paraissent très cohérents et j’aimerais savoir sur quelles sources vous vous êtes appuyées pour réaliser cet article.

    Merci

  3. Arnaud July 20, 2015 at 4:55 pm #

    Bonjour Erica,

    Un immense merci pour les liens que vous m’avez envoyés, qui me fournissent des informations de première qualité mobilisables pour mes travaux.

    Bien à vous,

    Arnaud

    • Erica August 31, 2015 at 12:28 pm #

      Merci à vous Arnaud pour votre amabilité, il me fait très plaisir!

      J’ai été vraiment heureuse de vous aider.

      Très bonne journée à vous aussi et à bientôt j’espère!

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