Los Angeles vs. New York: Where Is the Living Easier?
The price of New York real estate and taxes may be higher, but there are also hidden costs in Los Angeles life.
It may be good to be rich in L.A., but it’s better to be poor or average in New York City. According to several recent surveys, the rich get more real estate bang for their buck in L.A., but those with average or below average incomes are better off living in the Big Apple.
Of course, life in neither city is a bargain-- the cost of housing in both cities is far higher than the national average. According to the Cost of Living Index (COLI) at the Center for Regional Economic Competitiveness, the cost of housing in Los Angeles is 97.4 percent higher than the national average, but in New York, it’s 355.2 percent higher.
So how could the average Joe possibly live better in New York? For one thing, salaries are higher in Gotham. Janet Viveiros, a Research Associate at the Center for Housing Policy explains it this way, “Median household incomes of moderate-income households in the New York metropolitan area were higher, $3,930 monthly, than in the Los Angeles metropolitan area, $3,513 monthly.” That’s according to the “Losing Ground Report,” published in 2012.
She adds, “Moderate income households in the New York metropolitan area also had lower monthly transportation costs, $877, than their counterparts in the Los Angeles metropolitan area, $958.” The excellent and inexpensive public transportation systems in New York drive circles around L.A.’s congested freeway systems.
Still, Viveiros says that average folk will spend about the same amount on housing in either city. “The average housing costs of moderate-income households in the Los Angeles metropolitan area and New York metropolitan area were very similar: $1,340 a month in Los Angeles and $1,338 in New York metropolitan areas,” she says.
Home Prices: New York vs. Los AngelesView All 8 Photos
But if you’re in the top 1 percent, you’ll want to load up the truck and move to Beverly. First of all, it’s easier to be considered wealthy in L.A., where you only need to earn $445,000 to be in the top 1 percent. In New York, you have to make $608,000 to be considered a one-percenter.
If you’re searching for real estate in the luxury market, in New York you’ll pay, on the average, $1,925 per square foot, while in Los Angeles it’s substantially lower, at $1,100 per square foot.
Those who want to buy a home that’s more luxurious than 90 percent of the rest of the residents in New York, you’ll pay at least $2.9 million. To be in the top 10 percent in Los Angeles, you only have to shell out $2.1 million.
But it’s the statewide property tax rates that make the biggest difference to homeowners in each state. In New York, the average homeowner pays $2,280 in annual property taxes, while in California, the average homeowner pays only $1,450 per year. That means property taxes in New York are about 36 percent higher.
But if you ask any commuter, they’ll probably tell you that it’s worth the 36 percent difference to glide to work in 25 minutes on an air-conditioned train, rather than fight traffic for two hours on a congested L.A. freeway.