Last week we critiqued a Columbus, Ohio marketing campaign that attempts to lure area residents away by promoting the city’s low cost of living. We found that living in Columbus isn’t going to save a typical millennial as much as you might expect. This left us wondering how the cost of living in the District compares to other jurisdictions. In order to compare, we used the same methodology that we used last week. What we found is that District millennials, even after paying for expensive housing, end up with more purchasing power.
Millennials living in Baltimore, Charlotte, and New York City have similar purchasing power to those living in the District. Median monthly rent for a one bedroom apartment in Baltimore and Charlotte is roughly half of what residents pay in the District – however salaries in these jurisdictions are considerably less. Conversely, New York City millennials pay some of the highest rent in the country but large salaries offset the Big Apple’s exorbitant housing prices.
Unfortunately for millennials living in Boston and San Francisco, there isn’t much disposable income remaining after paying rent each month. Boston’s high housing costs and low median salary drastically reduce the amount of money millennials have to spend on non-housing goods. As for San Francisco, residents are burdened with the highest rent in the country. The median salary in the Bay Area is also high, but not high enough to offset the city’s expensive rental market. Millennials living in these housing markets might want to consider getting a roommate to help with rent.
As we stated in our post last week, millennials that want to buy a house or have children in the District will experience a larger hit to their wallets than if they lived in a comparable city. The median cost of a three-bedroom, two-bathroom home in D.C. is $788,000. In Charlotte it’s $255,569 and in Baltimore it’s $447,021. Child-care for two children in the District is 39 percent more expensive than in Baltimore and 62 percent more expensive than in Charlotte. Despite the large housing and child-care cost differences in these two cities, District millennials can take solace in knowing that the median cost of a three-bedroom, two-bathroom home in Manhattan is $1,355,865 and that child-care costs are 15 percent higher than in the District.
What exactly is this data? “Millennial” means people between the ages of 18 and 34. We got the median millennial earnings from the Census Bureau and the rent data from zumper.com. To compare non-housing expenses in D.C. and Columbus, we used the family budget calculator from the Economic Policy Institute. We subtracted childcare costs from the family budgets to get a more realistic budget for millennials living in cities. Data on median home prices is from NerdWallet. Child care costs are from the Economic Policy Institute.
Ginger Moored contributed to this article.