There’s no doubt that the City by the Bay is one of the priciest in America. Yet it continues to attract scores of people every year, looking to work and live here. While that may be hard for us to digest, we can’t deny the fact that San Francisco has a wealth of things that drive people to the city. To begin with, SF is a top-notch professional (read: technical) and educational hub, not to mention home to a flourishing economy generating employment opportunities galore! Educational and job opportunities aside, the city welcomes people across backgrounds and communities alike with open arms.
While we can go on and on about the reasons people flock to the city, let us revisit the first line of the blog, telling us that the cost of living in SF is very high, thanks to the continual rise in housing and rental prices, and those relating to groceries and healthcare. Therefore, if you’re considering a move to the city, it’s important to know what types of expenses you’ll be dealing with and the amounts you need to fork over to live a comfortable life in the city.
Here is everything you need to know about the cost of living in San Francisco:
1. Rental Expenses in SF
Rental prices are the highest for SF residents, so you’ll need to check your finances carefully before moving to the city. According to a report from Rent Cafe, the average rent in SF is $3700 and the national average is $1463, so you can figure out how much you’ll be able to afford, given the difference. As far as the rent for a one-bedroom apartment in SF goes, it’s $2872.11. Interestingly, the global pandemic did manage to create a dent of 2.3% in the prices of apartments but they recovered with an increase of 10.1% compared to last year’s prices around November.
Rental rates will vary from one neighborhood to the next and in terms of the amenities provided. South Beach, SoMa, and Mission Bay are areas that have the highest rents in SF while Outer Mission or Outer Sunset has rents lower than $2458.82 for a one-bedroom apartment. In this case, high rents refer to over $4000. In family-friendly neighborhoods like Noe Valley, a one-bedroom apartment is $2503 and Westwood Park is $2596.
As far as renting goes, people are always advised to follow the 30% rule, stating that 30% or less of your gross monthly salary should be spent on rent. Going by the guideline, your monthly salary needs to be $8616.33 should you decide to live in a one-bedroom apartment. It’s a given that many people may not earn that much. In that case, they need to search for more reasonably-priced apartments. In addition, considering the high rental prices, it makes sense to share space with someone you can split expenses with. In fact, more than 50% of millennials live with a roommate.
Finally, people moving from the South or Midwest are likely to face a rude awakening as far as rental prices go, so they should be adequately prepared, monetarily and otherwise.
2. House-buying Expenses in SF
If you think rental prices are high, you should hear the house-buying prices in SF! It’s a demand and supply imbalance for the most part, with the demand increasing every day while the supply remains restricted. Moreover, SF is spread over a mere 47 miles, so that doesn’t really leave much space for constructing many houses. The median price of a house is $1.35 million in the city while the national average is five times lower! You wouldn’t have to spend that much even in expensive cities such as NYC and Boston. Surprising, isn’t it?
The Bay Area is among the hottest places in terms of high housing prices. Houses in Marin County in northern SF can sell for a tad over a million while in San Jose, home to the prominent Silicon Valley, they are below a million dollars. Communities in the East Bay such as San Leandro, Hayward, and Oakland, have more reasonably-priced houses. Like rental prices, home prices also vary locale-wise, but because they’re generally costly, more than 50% of homeowners rent out their homes.
3. Utility Expenses in SF
SF’s moderate climate comes to the residents’ rescue as far as utilities go. Its temperatures hover in the fifties in winters, so not much heating is required. Neither do you need to use the air conditioner in summers to the extent that it results in high bills. Therefore, residents end up paying low electricity and gas bills. According to Numbeo, the average utility bill in SF should total $189.79 monthly for basic utilities comprising water, electricity, gas, and garbage which is lower than the national average of $240.
Set aside some money monthly for your internet and cell phone bills. You can expect to pay around $94 on average for your cell phone service and anywhere between $50 to $70 for internet services, which varies depending on usage. If you work from home, you’ll end up using more. Explore the options service providers offer to new customers where they combine internet and phone services and give you a solid discount, among other free services such as streaming services. In the end, if you’re lucky, you might come across a landlord who covers utilities like water and trash. In most cases, tenants pay for all the utilities according to their usage.
4. Food Expenses in SF
People in SF love gorging on food, so they don’t mind splurging on different kinds of cuisines. When you have more than 60 Michelin-starred restaurants and a range of global cuisines, who can resist? Your grocery bill will vary depending on your eating habits, your frequency of dining out, and the number of people in your family. According to Numbeo, residents spend $423.75 a month which is much higher than the national average of $324.20.
Do you want to spend less on food and groceries? Check out Foods Co. You could even visit the Ferry Plaza Farmers Market for affordable produce. Cooking at home might save you some money although the difference might not be substantial. A reasonably-priced meal amounts to $20 for one person while a meal for two with at least three dishes amounts to $85 at a medium-priced restaurant. You need to add a 15% tip to the overall amount. Are you interested in cooking at home? In that case, the amount you spend on groceries will be around 30.5% higher than the national average!
Here are the prices of some basic items to give you an idea:
As you can see, the items aren’t cheap, so whatever you buy, make sure the quantities are reasonable and you consume all of them.
5.Travel Expenses in SF
MIT’s Living Wage Calculator statistics reveal that a resident in SF spends $4900 yearly on travel expenses. If they have a family that includes two children, the expenses skyrocket to $13,317 every year! However, these expenses are for people who own a car.
SF has one of the best public transit systems compared to other equally expensive cities, so a car isn’t necessary to commute to places. In addition, your expenses come down drastically. Transit options include MUNI, the shortened form for Municipal in San Francisco Municipal Railway, the public transit system in SF, BART(Bay Area Rapid Transit), the primary rail transportation system for Bay Area, and Caltrain, operating in different parts of the city. A Clipper Card will work for all three systems, so buy it should you wish to travel using any of them and get access to discounts occasionally. If you get an adult pass inclusive of BART and MUNI, you’ll have to spend $98 monthly and $1176 yearly. MUNI offers bus and light rail lines, cable cars, and streetcars for residents to choose from. For BART, you need to pay $4 for a one-way ride.
The best part of the transit system in SF is that no matter where people may be in the city, they always have easy access to a public transportation stop.
Interestingly, 40% of people in SF prefer to use public transit options, so they don’t own cars. But those who do, need to dish out anywhere between $1341 and $1588 every year as auto insurance, which hovers pretty close to the national average of $1427. Parking forms an additional burden and you may end up paying anywhere between $150 to $600 per month. The cost varies according to the area you live in. Car owners have to deal with the cost of gasoline. Per May 2019 statistics by GasBuddy, the price per gallon was $4.20, catapulting SF to the top as the most expensive Californian city. If you want to do away with owning a car or using public transit, you can always take up ride-sharing services like Lyft and Uber.
SF is also a bikeable and walkable city, so these are some more options to move around the city. Biking may be a bit challenging due to SF’s hilly regions but there are tons of bike lanes and bike-share stalls across the city, indicating its popularity. Since shops, parks, and eateries are situated pretty close by, reaching places on foot is something you may want to explore.
6. Healthcare Expenses in SF
Healthcare costs are exorbitant and will differ depending on a number of factors such as the comorbidities, lifestyle, age, and place of residence of an individual. As far as numbers go, healthcare costs in SF are 24.7 % higher than the national average. But the best part about living in SF is that the medical facilities available to all are of global standards!
To give you an idea of some of the expenses you might incur based on the nature of your visit, let us share some numbers. You’ll need to pay $150 for a regular doctor’s visit and to buy prescription medicines, you might need to spend $449. You might have to fork over $145 for an eye exam and a dentist’s appointment will cost you $133. It’s also important to remember that these expenses aren’t borne by medical insurance, so your expenditure will vary based on your requirements.
In SF, if a resident has an insurance policy financed by their company, they need to pay a premium of $2545 per year. If they have a family comprising four members, the cost shoots to $8150 per year. These factors and a bunch of others will determine the monthly premium amount you need to fork over. If you need insurance not funded by your organization, Healthcare.gov should help you find a plan that is adequate and one you can afford.
To sum up, for those who can’t afford healthcare expenses, the San Francisco Free Clinic provides services that also cover the yearly physical.
7. Entertainment Expenses in SF
Entertainment is a significant expense too, especially because it’s one of the things you must have to live well. But having a budget is important too because these costs might become a burden if not handled well.
An individual might have to pay $1811 a year for entertainment. On the other hand, a family of four will have to dish out $4127. If you’re a fitness enthusiast who needs to sweat it out in a gym, be prepared to pay $83 every month, which as you must’ve guessed by now, isn’t cheap by any means. Consider the yearly amount, which comes to more than $1000!
SF has the honor of being the first city to have a park 10 minutes from every residence in the city, a record achieved in 2017! So, fitness freaks, outdoor enthusiasts, and pet owners can make the most of this free facility, which also includes outdoor activities such as skating, biking, walking, calisthenics, and so on! If you’re into sports, you have two options. One, you can watch the game at one of the numerous sports bars in the city. But if you believe in enjoying the game in person, you’re going to need a lot more money for it. The ticket prices vary depending on the game you want to watch. A San Francisco Giants game costs $58, while a San Francisco 49ers game costs $97. Finally, a Golden State Warriors game amounts to $278!
SF is renowned for its museums, so that’s something you can explore and learn a lot in the process. Although there are museums aplenty in the city, we’re sharing the admission ticket prices for some of the notable ones. If you’re visiting the San Francisco Museum of Modern Art, you’re going to have to pay $25. For the Asian Art Museum, tickets cost $15 and for the Walt Disney Family Museum, it’s $25 again. One of the things that stand out about most city museums is that they keep cheap passes for people with low incomes. Several of them even have one day a week or month reserved to allow people to view the exhibits for free.
For miscellaneous expenses, here are some more numbers. If you want to watch a movie, you’ll need to spend $15. You’ll need to fork over $86 for a visit to the vet, and should you want to treat yourself at the beauty salon, be prepared to pay $82!
In a word, goods and services cost about 25.9% more than the national average, but you might access concessions from time to time.
8. Income requirements in SF
To get a decent house or room for rent in San Francisco, your pay needs to be three times more than the rent you pay. Going by the price of a one-bedroom apartment or $2872.11, you need to earn around $8616.13 per month before taxes to live comfortably. Therefore, your yearly gross income should total $103,395.96.
Statistics reveal that the national median household income in 2019 stood at $62,843 while SF is currently at $112,449. While there may be opportunities galore for people moving to the city to work, especially in the tech industry, it’s challenging to save money given the city’s living standards. Additionally, there are many people who earn way below the threshold because it’s tough for them to get profitable jobs based on their credentials. For such folks, the social welfare system in SF acts as a savior in terms of providing adequate monetary help.
9. Taxes in SF
Tax rates across California are pretty high. In fact, its base sales tax rate is 7.25%, considered to be among the highest in America! In SF, people might end up paying a minimum combined $8.5% sales tax rate, comprising the city, state, and county sales tax rates.
In California, tax rates vary between 1 to 13.3% and are split into ten brackets. Those who have poor salaries pay low taxes while those who earn well, need to dish out more tax money. In the end, the percentage of property tax is 0.73%.
Conclusion
While we accept that San Francisco is an expensive city to live in, that shouldn’t stop you from moving there and living the life you’ve envisioned. Since housing costs comprise the biggest chunk of the expenses, budgeting for your rental house or room should prevent you from spending too much. Of course, if you want to save money, you should also ensure you curtail your other expenses so that you can experience the food, the natural beauty, the amenities, and the educational and professional opportunities the city has to offer!
