Reply to What do people mean when they say that DC is a “high cost of living“ area?

Forum Index » Money and Finances

Reply to "What do people mean when they say that DC is a “high cost of living“ area?"

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous]Yes, obviously housing costs more. But let’s break that down a little bit. Let’s say that a house that costs $800,000 here in the suburbs would cost $400,000 somewhere in the Midwest. Assuming a 20% down payment, because the house costs $400,000 more, you’d have to come up with an extra $80,000 for the down payment, which could be hard when you’re just starting out.

But once you actually buy the house, if you assume 5% interest rates on a 30-year loan, the DC house costs $3,436 per month (principal and interest) versus the Midwest house at $1,718 per month.  That’s an extra $1,718 per month or $20,600 per year (some of which is principal and is therefore really an investment and not an expense).  Yes, we have to factor in taxes as well, but it still doesn’t seem like it would be *all that much cheaper* to live in other parts of the country.

As I understand it, housing, food and transportation comprise about 70% of household expenditures. We already talked about housing.  Can food and transportation really be that much less expensive outside of major cities? If Pizza Hut sells a pizza here for $12, I doubt they’re selling it for $5 in Iowa. Same with cars – if a Toyota Corolla costs $25,000 here, I doubt they’re selling it for $10,000 in Montana.

Can you explain if you think I’m missing something?[/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics