The U.S. News Best Places Data Drill Down, separate from our overall rankings, is a regular series that sheds light on multiple data points in order to help readers make the most informed decision when choosing where to live in the United States. Visit our 2016 Best Places to Live ranking to see which of the 100 most populous metro areas made it to the top of the list based on good value, desirability, a strong job market and a high quality of life.
We all have to factor certain basic needs into our budgets — such as food, taxes, healthcare and housing. However, for many residents living in some of the United States’ largest metro areas, these needs can weigh a bit heavier on their wallets.
[See: The 20 Best Affordable Places to Live in the U.S.]
Being able to afford to live in a particular city or neighborhood doesn’t stop at the rent or home price, it also affects the quality of life for a person’s day-to-day routine — from accessibility to nutritious food and reliable transportion, to the ability to go out to eat, attend a concert or see a movie.
In order to define the methodology to determine U.S. News & World Report’s ranking of the 100 Best Places to Live for 2016, we asked Americans across the country which factors would most heavily influence their decision to move to a new city: the quality of life there, the state of the job market, the state of the housing market or the cost of living. Nearly 30 percent of the 2,000 respondents said that affordability would be the most important factor they would consider in their decision to move to that particular place.
Calculating the cost of living for the 100 metro areas evaluated for the Best Places to Live ranking looked at monthly housing costs data from the U.S. Census. This data included mortgage payments, utilities and taxes. The monthly housing cost for renters was then determined by extracting the cost of utilities and adding it to the average rent, which was then translated into annual costs. The blended annual cost of living was determined by combining the two amounts using a weighting determined by the percentage of the population that owns versus rents.
[See: The 20 Best Places to Live in the U.S.]
Among the 100 metros that were ranked, the average blended annual cost of living in 2015-2016 was about $18,627. In the 10 metro areas with the highest blended annual cost of living, the average was significantly higher at about $28,893.
At the top of the list is New York City, which was ranked No. 96 in the 2016 Best Places to Live ranking. Although many people dream of living in New York City, the fact of the matter is that the average person cannot afford to sustain a comfortable life there. Those who make the equivalent of the metro area’s average household income must spend more than 50 percent of their earnings on housing expenses.
Below are the 10 metro areas with the highest annual cost of living.
| Place (Metro Area) | Blended Annual Cost of Living for 2015 – 2016 | Spot in 2016 U.S. News Best Places to Live ranking | Cost of Living as Percent of Average Income |
| New York, New York | $36,101 | #96 | 50.29% |
| San Jose, California | $33,075 | #10 | 34.56% |
| San Francisco, California | $30,495 | #9 | 36.65% |
| Washington, District of Columbia | $28,426 | #8 | 29.96% |
| Honolulu, Hawaii | $28,004 | #26 | 36.75% |
| Boston, Massachusetts | $27,832 | #30 | 35.83% |
| Los Angeles, California | $27,073 | #83 | 42.58% |
| San Diego, California | $26,337 | #16 | 38.97% |
| Santa Rosa, California | $25,865 | #62 | 38.60% |
| New Haven, Connecticut | $25,719 | #88 | 39.13% |
San Jose, San Francisco and the District of Columbia are also included in the top 10 list of the overall Best Places to Live ranking. It may be expensive to live in these three places, but the household incomes there are higher, allowing residents to more easily afford the cost of living. With higher household incomes, residents in San Jose and San Francisco pay less than 40 percent in housing costs and residents in Washington, D.C. pay less than 30 percent.
[See: The 20 Most Desirable Places to Live in the U.S.]
Be sure to check out our 2016 Best Places to Live methodology for insight on how we analyzed and determined our calculations.
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10 Places With the Highest Cost of Living originally appeared on usnews.com
