It’s no secret that San Diego can be pricy, but the cost of living has now catapulted “America’s Finest City” to the top spot in a U.S. News & World Report ranking of most expensive places to live in the country.
In the publication’s rankings for 2023-2024, San Diego was deemed the most unaffordable metro area based on median gross rent and annual housing costs for mortgage-paying homeowners.
Los Angeles was a close second.
In August, the median price for a single-family home in San Diego surpassed $1 million for the first time in history — nearly $650,000 more than the national average by some estimates.
U.S. News and World Report also pointed to additional fees that San Diego residents have to pay, such as homeowners association dues or apartment complex maintenance costs, as another factor driving its unaffordability.
However, the magazine said that many residents are willing to pay elevated prices relating to the cost of living, given other aspects of the region that make it an ideal place to live.
They added that some San Diegans often refer to the cost-of-living differences as a “sunshine tax.”
In Los Angeles County, the median price of a single-family home surpassed $900,000 in September for the first time on record.
A full list of the top 25 “most expensive places to live” in the U.S. can be found here.
This ranking comes as the inflation rate nationwide remains a persistent problem for federal officials, but San Diegans seem to have been feeling it even more.
In San Diego, the U.S. Bureau of Labor Statistics estimated that the city exceeded the year-to-year national rate of inflation, which was around 3.7% in September. Over the last 12 months, prices in the San Diego area advanced about 4.7% overall, according to the bureau.
Housing costs have been one of the most pressing issues facing elected officials, with prices skyrocketing for both buyers and renters due to a continued lack of available units to meet the demand in the region.
According to BLS, rent has risen in the region about 8.8% between September 2022 and September 2023. Meanwhile, the average price for a single-family home has risen about 10.1% during that time, according to data from the Greater San Diego Association of Realtors.
Electricity costs have also had a massive increase over the last year, jumping about as 16.2%, according to BLS. Other increases reported by the bureau in key areas include:
- Dining out: 5.8%
- Gasoline: 5%
- Medical care: 2.5%
- Alcoholic beverages: 2.1%
It’s not all bad news though, as a handful of other price categories have seen a decrease over the last year. According to the bureau, prices eased in areas like utility gas services (-11.4%), used vehicles (-7.7%), fruits and vegetables (-5.8%), “durable” items purchased by consumers (-3%), and products in the meat, poultry, fish and eggs food group (-2.7%).
The overall inflation rate in the region has also fallen quite a bit compared to the price differences in the past two years. In September 2022, BLS estimated the annual inflation rate was about 8.5%. The year prior, the rate was estimated to be about 6.5%.