Many people dream of retiring to some of the most coveted hot spots in the country for their temperate climate, senior-friendly amenities and physical beauty. To do so, however, often comes with a steep price tag. GOBankingRates set out to assess the cost of buying a home in five of the top U.S. cities where retirees might have their eyes on retiring to.
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GOBankingRates analyzed the 100 most populated cities in the U.S. with the highest percentage of people aged 65 and over. The top five are among the most popular for seniors, and we included the average home value, mortgage payment and cost of living to give retirees an idea of what it costs to live there.
Average home value: $629,813.57
Average mortgage payment: $3,940.11
Annual cost of living expenditures: $70,389.60
While Miami may be at the top of the list of places retirees flock, it demands a high price. You’d need to earn a household income of $140,779.21 to afford a home in Miami. And other costs in Miami aren’t cheap, either.
Healthcare costs run around $653.47 per month; groceries are $428.93 per month and transportation is $412.74 per month. With a mortgage of almost $4,000 per month, retirees may have to think long and hard before settling here.
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New York, New York
Average home value: $760,483.82
Average mortgage payment: $4,757.58
Annual cost of living expenditures: $87,049.45
The Big Apple is an attractive place for retirees due to its public transportation and services available at nearly any hour. However, you’d have to be earning a household income of $174,098.90 in order to afford a home here. And with a mortgage payment that’s closing in on $4,800 per month, it might be steep for some.
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Average home value: $919,114.99
Average mortgage payment: $5,749.98
Cost of living expenditures: $91,567.44
Arizona is among the most popular places for retirees due to its temperate climate and senior-friendly amenities. Demand has driven up home prices, however. Not only is the average home value in Scottsdale almost $1 million, you’d have to earn a household income of $183,134.88 to afford a home here.
Average monthly healthcare costs are around $581.21, and utilities are $361.47 monthly. With a mortgage payment of almost $5,800, retirees must be in superlative financial straits to afford a home here.
Average home value: $1,301,264.00
Average mortgage payment: $8,140.70
Cost of living expenditures: $127,234.27
Hawaii is known for being among the most expensive states in the U.S., largely because so many of its goods and services must be flown in, and because tourism drives up prices. Honolulu is no exception. To retire here, retirees need to have a household income that is almost double of what you need to earn in Miami — an amazing $254,468.53. Monthly mortgage payments alone, $8,140.70, are more than the total monthly expenditures of the bottom three cities on this list.
San Francisco, California
Average home value: $1,385,925.88
Average mortgage payment: $8,670.35
Cost of living expenditures: $132,758.68
California’s City by the Bay has been a Mecca for tech talent in the past decade, which has driven up home prices exorbitantly. To afford the average home here, the value of which is closing in on $1.4 million, you need a staggering household income of $265,517.36.
Other expenses are also higher here, with healthcare coming in at an average of $721.96 per month and transportation at $667.72 per month.
Methodology: In order to find out if you can afford a home in the top U.S. cities, GOBankingRates analyzed U.S. cities from the U.S. Census American Consumer Survey to find the top 100 most populated cities in the U.S., then found the population of people aged 65 and over and calculated the percent of the population that is 65 years old or over. The top 25 cities in terms of percent population ages 65 and over were kept. For each city the average cost of living for each expenditures; grocery, healthcare, utilities, transportation and miscellaneous were sourced from Sperling’s BestPlaces and multiplied by the national average cost for each expenditure as sourced from the Bureau of Labor Statistics Consumer Expenditure Survey to find the average cost of living for each city. The average home value for September 2023 was sourced from Zillow Home Value Index and using the 30 year Fixed Rate Mortgage Average as sourced from the Federal Reserve Economic Research, and assuming a 10% down payment, the average mortgage can be calculated. Combining the mortgage and the expenditure costs will show what it costs to live in each city. In accordance with the 50/30/20 rule the needs should be 50% of your income so GOBankingRates doubled the total cost to find the income someone needs to live in each city. The livability index was sourced to show the overall happiness of living in each city and was included as supplemental information. All data was collected and is up to date as of Nov. 17, 2023.
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This article originally appeared on GOBankingRates.com: Retiring In a Boomer Hot Spot: Can You Afford a Home in These Top 5 Cities?