GOBankingRates just released its 2019 Cost of Living study for both homeowners and renters. Using government and industry data, GOBankingRates put together totals of “necessities” such as housing, health care, groceries, utilities and transportation costs. It then applied its “50-30-20 Rule” to determine which cities would be the most affordable and/or unaffordable places to “live comfortably.”
The “50-30-20 Rule” translates into 50% of income being spent on necessities, 30% targeted for discretionary spending and 20% directed towards savings. Obviously owners and renters alike would need an income twice the amount that goes to basis living expenses if those owners/renters wanted to live comfortably.
Least Affordable Metros Based Upon Average Annual Expenses
Metro Median Income Deficit/Surplus for
Owners Renters
San Jose $96.700 -$2,100 +$24,800
Boston $62,000 -$2,700 +$1,800
Oakland $63,300 -$9,400 +$900
Long Beach $58,300 -$11,000 -$4,000***
Honolulu $80,100 -$15,000 +$17,400
Denver $39,000 -$15,500 -$12,600
NYC $57,800 -$16,400 -$6,500
Miami $34,000 -$18,500 -$20,800***
San Francisco $96,300 -$18,900 +$14,200***
Los Angeles $54,500 -$20,700 -$13,600***
Clearly, San Francisco is the most costly metro in which to live for mortgage holders. A person would need to earn $230,000/year to live comfortably, almost $134,000 higher than the city’s median income. Renters in San Francisco would need to earn $82,000/year to live comfortably, -$14,000 below the city’s median income.
Miami is a tough place to live comfortably for both mortgage holders and renters. Mortgage holders would need $52,500/year to cover the basics in Miami; renters would need $54,800.
Most Affordable Metros Based Upon Average Annual Expenses
City Median Income Deficit/Surplus for
Owners Renters
Virginia Beach $70,500 +$28,900 +$26.800
Raleigh $61,500 +20,700 +$21,300
Charlotte $58,200 +$18,200 +16,700
Omaha $53,800 +$17,900 +14,500
Fort Worth $57,300 +$17,700 +13,700
Okla. City $51,600 +$17,700 +$14,400
Kansas City $50,100 +$16,300 +$14,000
Colo. Springs $58,200 +$15,800 +$16,600
Arlington $55,600 +$15,200 +$11,000
Columbus $49,500 +$15,100 +$11,900
Note that owners with mortgages do “better” with more “surplus money” than renters in 3 of these 10 most affordable metros.
