This seems objectively false. By definition, if it costs more to buy the same size apartment, then the cost of living (vis a vis housing) is higher. Yes, you can downsize and accept having to live with roommates to get by, but that doesn't mean the cost of living isn't higher.
According to a cost of living comparison between Austin, TX (where I live) and NYC, you would need to make 140k in NYC to match 90k in Austin:
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.
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.
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.
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.
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.
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"
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.
For instance, living in NYC or the other big dense cities involves making trade-offs that don't even make sense in a place like Austin (and vice-versa). Yes, in NYC, your living quarters will be much smaller, and no, you won't need a car to be comfortable.
The cost of living for other stuff outside of housing and transportation is going to be highly variable depending on your lifestyle. Again, it is all about trade-offs, whether or not the trade-offs are desirable depends on the individual.
In any event, this generates a more detailed breakdown:
A few interesting examples (I chose to compare to Brooklyn, since Manhattan was over the top ridiculous):
- Austin Brooklyn
Home Price $232,059.83 $944,473.13
Rent $926.30 $2,249.13
Doctor Visit $84.28 $105.09
Pizza $10.08 $11.33
Beer $8.43 $9.81
Ground Beef $2.54 $3.39
Weirdly, optometrists are way cheaper there (94$ vs 56$). Hmm... I'm going to have to co-ordinate my checkups with my vacations...
One might be able to make some good comparisons about rent, since that's so heavily market-driven... but groceries? I find that the price of groceries varies so widely across any city, or hell, any neighborhood that one cannot possibly make a reasonable claim to "a bottle of beer costs $X", nor "a delivered pizza costs $Y".
Take where I'm right now for example - your link has the broad area "Seattle-Bellevue-Everett" - which covers every single neighborhood in Seattle, from the cheapest in the Central District all the way to the most expensive in Belltown. And then it moves north to heavily blue-collar areas like Everett and software-engineer-land like Bellevue.
How can any reasonable pricing index be established like that?
I own a 2 bedroom in Brooklyn (1200sqft) with view of the Ocean that's that is less expensive that the number on the top right by 150K$. I definitely think my place is "above average", so these numbers must be skewed by my neighbors that paid 2.7MM$ for an apartment the same size because it had a gold-plated ceiling (Russian Neighborhood).
Just out of curiosity, was that $8/9 for a pint/litre of beer or a 4 pack. When I was in NYC last year I don't recall it being anywhere near that expensive.
The anecdotal warning goes double here, because the NYC lifestyle deemphasizes groceries.
Anecdotally, I recently took a road trip across the southwest and Fairway was cheaper than similar stores in Tucson, Flagstaff, Moab and Boulder. In Minneapolis things got cheap again but in Northern MN/ND they are about the same (as NYC).
As someone who has tried to figure out how to live in the area I grew up (northwestern Minnesota) instead of New York or the Bay area, this isn't quite accurate. In many (most?) flyover states software jobs pay 1/5-1/3 what you would make in NYC. The only technology needed is .NET or sometimes Java - the last 5 years of "scaling Ruby" or whatever you were doing, are more like a five year gap in your resume. The number of available positions are orders of magnitude less than NYC or the Bay. Often, you can get paid more and have an easier time getting work if you're an IT dude, rather than a software developer. The other option is being a remote worker for someplace cool but you usually need to have a career somewhere else for a few years to make connections. Of course, the American outback might be a good place to hole up and work on your own software startup for a while, but as soon as you need to hire you'll have to move again.
If you want to be able to throw a dart at a map and pick up high paying work wherever you want, the answer is still being an MD. The worst MD in North Dakota can make what the best software engineer in Manhattan makes. In a weird inversion of most employment reality, doctors can often make far more in a rural setting than they can in a mid-sided metro, due to "hardship post" style compensation. The career that is a close second for job mobility is "physicians assistant" - they make 80 grand no matter where they live.
I thought this was true, but a recent job search proved this to be quite wrong (at least for me). There are plenty of telecommuting jobs out there now that do not require previous experience with the company or telecommuting in general. Additionally there are more and more purely distributed companies out there that don't even have an office (a possible solution to you start-up problem). You may not get paid SF/NYC salaries but you can get close enough (especially compared to the average pay for your area).
There's a few very companies trying to do cool development but for the most part you're best served if you're an expert in Java or .Net.
Or I could do that HERE and pay less, too. So it's -true-.
However, its all relative...
If I were single and wanted to eat noodles and share an apartment I could easily make NYC work - but things are still a bit more expensive, even buying beer on tap ($5 for Bud-like-quality, $6 for Guinness in many places). Don't forget you need to keep up with all those ironic t-shirts and that lomo camera ain't cheap :)
However, now that I have kids and would want very simple things like a garden, a good school, in a relatively safe neighborhood then you have to be prepared to pay a huge amount in rent to be in that school district and to get that ground-sloor apartment in a nice brownstone (in Park Slope, Brooklyn that would be close to $4K a month in rent for a 2bdr - thats based on some parents I know and what they pay).
Haha, this was a typical NYC experience: comparing rents and not believing the deals other people are getting :)
It does not look that nice right now. Those photos were taken by the previous tenant, who was an artist and put some time into the place. Still, I love this apartment. I pay $1,600 a month for it. I'm in Brooklyn (16 Waverly Ave, right by the old Naval Yards, about 12 blocks outside of Dumbo).
I agree with the person who said the main cost savings in New York is that you do not need a car. I get everywhere with my bicycle. When it is raining, I take the MTA. The unlimited MTA is about $100 a month, which is slightly more than $3 a day for unlimited travel by subway and bus. Not a bad deal.
That aside, I found this article interesting, especially with regards to rent. I loved every second I've spent in NYC, hopefully I'll be there to work eventually.
There are rumblings about changes to visas that will make it easier for startup entrepreneurs to come to the US, which is quite exciting. Right now I can only work for my employer, so I can't start up any little side projects.
As a software engineer you’re very privileged. You will always a job in any city, state or country. Even if you suck, there will always be someone to hire you because the market of software engineers is hot and the numbers play in your favor.
Oh, it's satire.
EDIT: Okay, wow, apparently it's not satire. In that case, i have no idea how the author got this idea but i don't think he could be more far off.
I've lived in NJ and commuted to NY for essentially my entire professional life, and quite happy with that setup.
It helps that DC is almost as expensive, everything I've seen so far apartment-wise looks like I'll be paying the same amount of money for a 2 bedroom that I'm currently paying for a 1 bedroom (albeit smaller overall square footage).
I'll also have an extra 200 a month from not having a car (insurance and parking), and most other costs seem to be about the same.
If I were moving from somewhere cheaper, maybe I'd feel differently.
Also smaller border crossings tend to be better than large airports. YVR and YYZ are quite strict about documentation requirements and are a bit power-trippy from my and friends' experiences. Land crossings are better.