The real mitigating factor is the car. When you cut out car payment/car depreciation, insurance, gas, maitenance and take that money and put it towards your housing, it evens out.
I own my car outright, but I expect maybe $100 a month in maitenance, $100 a month in insurance, $200 in gas, and probably $100-$200 a month in depreciation. My current rent for a 3BR house with a yard is $1400. I don't need a 3BR, but I literally can not rent anything smaller that isn't a shitty apartment, so basically I can't spend less than that.
So what can I get for $1900 in NYC? From what I've seen, I'd like it better than what I have right now. Will I get exactly the same square footage? Of course not. I will have someone living above me and below me where now I have a single family home. But it's an apples to oranges comparison, it would take millions of dollars to buy the amount of land I'm currently renting and build a single family home - becuase its a city. It's just inherently different.
I want enough room to have a bedroom, a bathroom, an office with my computer and a pull-out couch for friends, a kitchen to cook in and a family room/dining room to have a couch, a TV and a table to eat at. I can pull that off on my current salary whether its in NYC or elsewhere. So a cost of living calculator doesn't take into effect the fact that although the dimensions of the room are smaller, the NYC apartment is functionally the same as my current one that is far, far, bigger.
The real mitigating factor is the car. When you cut out car payment/car depreciation, insurance, gas, maitenance and take that money and put it towards your housing, it evens out.
No. I moved from a 1800sf 3br house, 2 cars lifestyle in Austin, TX to 650sf 1br apartment and no cars in NYC. And the cost of living difference was still huge. I'd say even more significant than 90-vs-140 ratio proposed above.
It's hard to pinpoint a single reason for this though. Honestly, if you're an engineer in Austin TX and you're moving to NYC you should stop even attempting to calculate the "comparable" salary. You can't have an equivalent of a 1800sf house in NYC on any engineering salary. Frankly, it's kind of pointless anyway since the difference in lifestyles are so vast that the meaning of "comparable" becomes fuzzy.
And no, it's not easy to have a kitchen in NYC for $1900 (in many neighbourhoods you may like), and most likely your A/C situation will drive you nuts: I never owned a window-mounted unit until I moved and my first summer I was cursing every night. Just for the record: the COO of a hedge fund lived on the top floor of my building and he had the same shitty, noisy window-mounted units but he didn't even notice the noise.
Finally, to throw some numbers out there, just for fun: after 10 years in Austin it _felt_ like 200K/year in NYC was what I needed to feel comfortable there. YMMV.
Saying you lived below a COO makes it seem like you lived in Manhattan. It is quite easy to live comfortably in the outer boroughs (one hour commute to Manhattan) on far less - I would be comfortable with even $40,000 a year.
I moved from the Bay area to Manhattan last year. I feel poorer now than when I was a grad student.
Those taxi fares add up. I've heard many people say NYC has a great public transit system ... that hasn't been my personal experience. Specifically, getting cross-town (and please don't suggest the bus ... getting a root canal is better than enduring those).
Other costs I didn't think about carefully before moving:
- Laundry ... in-suite washers and dryers are considered a luxury in Manhattan.
- City taxes ... ouch!
- Groceries: Not having a car in the city means that you are far more price inelastic.
There is a great quip I've heard: Manhattan is designed for one purpose. To part you with your money :-p
I must admit, I was pleasantly surprised at the vibrant startup/tech scene in NYC. There are a lot of true craftsmen in the city ... you just have to be prepared for a serious reduction in quality of life in SOME aspects in return for betterment of others.
Taxi fare? Where do you live? I've lived in NYC for about 8 months, and I've taken the taxi by myself about three times, and that was purely out of wanting to get home faster.
Getting cross town definitely sucks, but unless you live and work on far opposite sides of town, it's totally doable.
I think your post highlights a key point about NYC: you have to live in the right place. I pay a bit more to live where I do (East Village), but the transit options are awesome, there are numerous grocery stores and markets within walking distance, and many cheap or at least reasonable restaurants nearby.
Another data point: I've lived in Austin for 13 years witbout a car. I am 31. I live in what I consider the best part of Central Austin and ride the bus to downtown for concerts/drinks or to the University area, walk to nearby bars and coffee shops. 1100 sq ft with front and back yard, garage for 900. Split with roommate is 450. No state income tax. I understand that New York has a million options and many city amenities, but I dont understand how one could say the costs even out.
It won't even out from everywhere - I would say that living for $450 a month in a decent place in an urban part of a major American city is abnormally inexpensive.
The article's author came from Seattle - and I can say without a doubt that this city is expensive. Not NYC expensive, but if you took a nice place in Bellevue or Kirkland, and included the cost you're paying for your car - it would come up to NYC rent.
I'm in the middle of a relocation to SF right now, and equivalent rents in SF are maybe ~30% higher than here in Seattle... When you're in the ballpark as SF, you're an expensive city.
Having seen several folks here mention Austin specifically, why isn't the Austin startup scene as hot as the NYC one - particularly given the cheaper costs in general? I have family so I would have issues with trading hours for equity (though I hope someday to down scope my budget enough to do so), but it seems that with SXSW and other things going on that Austin ought to be a possibly YC SouthWest sort of place. Is it perhaps TOO laid back?
Depends, I rent a 2 bedroom in seattle for 1525 downtown, and take the bus on microsoft's dime to work almost everyday. In new york I lived in what was more or less a walk in closet for 600 and purchased a monthly subway pass for about 85$ a month.
Theres so much to do in new york though that the accomodations didn't really impact my quality of life.
Additionally, Food was cheaper in astoria than it is in seattle, or than it was in california. Street vendors are tasy and inexpensive. Resturants outside of manhatten are reasonable. A couple of resturants inside of manhatten are reasonable.
Clothing was pretty cheap especially for the quality level if one is willing to hunt around a bit for good aftermarket stores.
7$ beers in the city were a little annoying but prices plummet as you head towards queens or brooklynn.
Life may be cheaper in some locals but the quantity of ammenities and quality of life makes up for a possibly modest increase in expense.
. . . and before everyone starts down voting me let me just say "boo, microsoft bad. Wahh, terrible, evil giant"
Your post seems to support a conclusion opposite that of which you draw: cost of living is higher in NYC, but if you're willing to live in a much smaller space, you can pay the same amount. Which is basically the definition of "higher cost of living."
Thanks to increasing focus on public transportation and ZipCar, cars aren't just optional in New York anymore. I've lived in New York, Seattle, and San Francisco with no car.
In both Seattle and SF my cost of living was significantly less than it was in New York and my standard of living was much higher.
The car makes an enormous difference, but the cost of living in New York is not limited only to rent. Even basic food items, toiletries, and other household items all cost a significant markup from median cost of living.
I didn't find that was true at all. Toothpaste, toilet paper, mattresses, TV sets, etc have standardized pricing across the country. If anything, the more remote you go, the more stuff costs. Except in South Dakota. For some reason everything is really cheap in South Dakota.
You might be able to, but you'll pay 10% more in NY over many other places (but not Seattle) due to Amazon being forced to charge sales tax in KS, KY, NY, ND and WA.
This answer also isn't responsive. If you you want "enough room to have a" &c &c, you could sell your single-family home in Des Moines, buy a condo, and pocket the difference.
I own my car outright, but I expect maybe $100 a month in maitenance, $100 a month in insurance, $200 in gas, and probably $100-$200 a month in depreciation. My current rent for a 3BR house with a yard is $1400. I don't need a 3BR, but I literally can not rent anything smaller that isn't a shitty apartment, so basically I can't spend less than that.
So what can I get for $1900 in NYC? From what I've seen, I'd like it better than what I have right now. Will I get exactly the same square footage? Of course not. I will have someone living above me and below me where now I have a single family home. But it's an apples to oranges comparison, it would take millions of dollars to buy the amount of land I'm currently renting and build a single family home - becuase its a city. It's just inherently different.
I want enough room to have a bedroom, a bathroom, an office with my computer and a pull-out couch for friends, a kitchen to cook in and a family room/dining room to have a couch, a TV and a table to eat at. I can pull that off on my current salary whether its in NYC or elsewhere. So a cost of living calculator doesn't take into effect the fact that although the dimensions of the room are smaller, the NYC apartment is functionally the same as my current one that is far, far, bigger.