Cost of living in San Francisco in 2023
San Francisco stands as a global hub for culture, finance, and technology, housing some of the world’s most renowned tech giants. However, its steep cost of living has contributed to a recent decline in population. According to U.S. Census data, between 2020 and 2022, the city’s population decreased by approximately 7.5 percent. If you’re contemplating a move to San Francisco, it’s crucial to be well-informed about what to expect in terms of expenses.
Cost of Living in San Francisco
Living in San Francisco comes with a hefty price tag. RentCafe data reveals that the city’s cost of living is 28 percent higher than the California average and a staggering 79 percent above the national average. Day-to-day expenses like utilities (32 percent higher), food (31 percent higher), and transportation (38 percent higher) all contribute to this high cost of living. However, it’s housing costs that truly stand out, making up the largest portion of most people’s expenses.
Housing Costs in San Francisco
Navigating the housing market in San Francisco can be a daunting task. Whether you’re looking to buy or rent, be prepared to spend a substantial amount. RentCafe estimates that you’ll be shelling out a whopping 207 percent more than the national average.
For prospective homebuyers, having a substantial budget is essential. As of April 2023, the median sale price was just over $1.33 million, according to Redfin. Renting doesn’t provide much respite, with an average monthly cost of about $3,313. These figures can be out of reach for many Americans.
Job Market
While San Francisco is home to major employers, the city has experienced significant layoffs in recent years, affecting over 24,000 individuals from 166 companies in 2022. The tech industry, including giants like Twitter, Meta, and Alphabet, saw substantial labor cutbacks. Predictions for the upcoming year indicate a continuation of declining employment figures.
However, there is a silver lining. According to the California Employment Development Department, San Francisco County had an unemployment rate of 3.0 percent as of March 2023, lower than the national rate of 3.6 percent during the same period. Non-tech sectors like leisure and hospitality have seen year-over-year employment gains.
In terms of compensation, high salaries in the city help offset the high cost of living. The average salary in San Francisco as of May 2023 is $94,480, according to ZipRecruiter. Salaries typically range between $76,000 and $112,000, providing a decent cushion.
Food Costs
Food expenses in San Francisco are approximately 31 percent higher than the national average. MIT’s Living Wage calculator offers a detailed breakdown of food costs. For instance, a single adult can expect to spend around $4,686 annually, while an adult with one child would face an annual bill of $6,916.
Transportation
San Francisco boasts a well-developed public transportation system, including buses, trains, ferries, and the iconic cable cars. Fares on BART and Muni are priced reasonably, with a single adult ticket on Muni costing $2.50 and a monthly pass at $81.
For those who prefer driving, be prepared for higher gas prices, with the average cost per gallon at $4.79, as opposed to the national average of $3.53.
Local and State Taxes
Understanding the tax landscape in San Francisco is crucial for financial planning. Sales tax is set by the state at 8.625 percent. Residents pay a flat city income tax of 1.50 percent, along with California state income tax, ranging from 1 percent for lower earners to 13.3 percent for those with annual salaries above $1 million. Property tax rates are based on assessed value, with a rate of 1.179 percent for the 2022–2023 tax year.
Conclusion
Relocating to San Francisco offers a unique blend of opportunities and challenges. Having a knowledgeable local real estate agent by your side can make a significant difference in navigating the city’s demanding housing market. Before taking the plunge, carefully consider your budget and assess whether life in this vibrant yet costly city aligns with your aspirations.