Living in San Diego is Expensive

Can you afford the cost of Living in San Diego in 2023?

Living in San Diego is expensive.

In recent times, articles like those from the San Diego Union Tribune have highlighted the escalating cost of living in San Diego. As of 2023, many prospective residents are using tools such as the "living wage calculator" to gauge how much they would need to earn to enjoy a comfortable lifestyle in this coastal gem. There are clear reasons why San Diego ranks among the priciest places to live in the U.S. It's not just the year-round pleasant weather or the picturesque coastline along the Pacific Ocean. It's the city's rich cultural blend, the outdoor activities it offers, its lively culinary scene, and the chance to immerse oneself in diverse traditions. If you're considering moving to San Diego, it’s a good idea to budget for expenses like taxes, monthly rent, and even a gallon of gas, which might be slightly higher than in a different city. 

So with the market in San Diego being so expensive, some wonder: is it worth it?

A look into the true cost of living in San Diego in 2023

A quick glance onto prices, and home appreciation.

Expense Category

Percentage Higher Than National Average

Overall Cost of Living


Health Insurance










A few of you may be thinking “Gosh, that’s a really high cost of living!” and I'd hopefully be joking if I denied it, but there are a few options to make it a bit more affordable., There are ways to build a nest egg when purchasing a home in San Diego.If you’re thinking about home ownership in San Diego county, that could arguably be one of the best decisions that you make. Redfin quotes “August 2023, San Diego home prices were up 9.4% compared to last year, selling for a median price of $930K”... That’s 9% appreciation! With inflation at 3% in October, you’d be gaining rapid equity, and even if (when?) it bounces back up to the 6.5 it was at last year, you would still be winning.

What are the median home prices

Well, that depends on where you look. At the time of writing this article, the average home price in San Diego county is $979k (although, this is dependent upon which area of San Diego). Even to me, who's used to looking at these numbers, that still strikes me as high, which is why I went to find the most affordable part of SD - San Ysidro. They have a median price of 437k, which is actually only a little higher than the national average, which according to the Federal Reserve Bank of St Louis, in 2023 sits at about 416k. If you're planning to move to San Diego but be on a budget, there are still many options available to you. 

 What salary do you need to afford a house in San Diego?

While there are a lot factors that go into being able to afford a home in San Diego, it will require understanding of a few things:

  • Mortgage payment 
  • Interest Rate
  • Loan Term
  • Down Payment
  • Taxes
  • Utilities
  • Cost of groceries
  • Transportation
  • Leisure
  • Debt such as Credit Card, Car Loans, etc. 

So what does this all mean? With interest rates at 7.40 (picture below) as of today (Nov 14th 2023), if we go over to Google's Mortgage calc and punch in a $600k loan, you'd wind up paying close to $4,300 just on your loan per month. The 28/36 rule for housing costs show that you would want to be making around $180,000 a year. Annually, health insurance is going to set you back about $5k per person, car insurance will be roughly $1.5k, and home owners insurance about $ 1k per person a year. That being said, it's also been rumored that about 1/4th of San Diego residents spend about half their income on housing annually. 


Some of you now might be wondering, "Are all home owners making around 180k a year?" and that is a hard no. Let's go into a few ways that you can make your move to San Diego, and some of the potential strategies you'll go over if you choose us as your realtor. 

How do people afford to live in San Diego?

House Hacking
Okay, so most of you have probably at least googled "How do I live in an expensive city like San Diego?" and come to find many places telling you to shop around for insurance, transportation hacks, and all of that other good stuff. We'll delve into that too, but I'm a bit of a dessert before dinner kind of guy. We're going to start with house hacking.

What is house hacking? House hacking is the act of getting a residence, and renting out all the other rooms, while you live in one. This is a great way to get a house, while reducing the cost of your mortgage, and hopefully making some life long friends along the way... But if you're anything like me, you hate having roommates. Which is why it's really good news that you can get an FHA loan on small apartment complexes (up to 4 units)! This is one of the best ways to reduce your mortgage cost immensely. The only downfall is that you will have to manage the other units. Wrapping your head around all the numbers can be a bit confusing at the start, but once you start seeing the monthly rent checks come in, and your mortgage isn't such a burden on you, it's relieving.

So how much can it reduce your costs? If you google “house hacking”, you'll find people claiming it can even pay them to live there. That's true, but in San Diego, that will most likely not be the case at first. That being said, it will definitely reduce your living cost in San Diego. After a few years, rent prices go up, but your mortgage stays the same. So the longer you own that property, the cheaper it becomes to own. This is also a great introduction into real estate investing, and reduce 

Living Modest
This is probably going to fall into one of those "I saw this on google" things, but it's something that is not overrated. While you're getting your grips in San Diego, if you ARE trying to make it on a bit more of a budget, then this can not be stated enough. This is one of those cities where there is so many things to do, and things can be a bit more on the luxurious side, that it can be easy to overspend if you aren't conscious of where you're spending money. Places like Desert Industries and Aldi's make access to things like clothes and food more affordable. Where there are expensive costs, there typically are alternatives.

SD is a city of luxury, indeed. On the flipside, it's a city of modesty. Modest in the way that you have so many free things to do, it's almost just as easy to forget that you even need money to enjoy some of the nicer things. Balboa Park is a great example, of where many families go and enjoy the museums and exhibits. Mission Bay Park is another one, as the beauty of the ocean can never be spoken of enough, especially if you have little ones who would enjoy the parks there. 

Health Insurance
Depending on your income bracket, you and your family may actually qualify for help with health insurance. In some cases, you may even qualify for free health insurance, which can be a huge relief. San Diego has one of the leading health care systems in the nation, which is one of the reasons people love living here. 

The bottom line?

The bottom line is that while day-to-day life in San Diego can feel steep, with strategic planning, the payoff of living in America’s Finest City can make it worthwhile. Utilizing tactics like house hacking allows you to dip your toes into real estate investment, which builds equity and assets. As rental prices increase over time, your fixed mortgage payments start to seem like less of a burden. Being frugal by bargain hunting and enjoying the area's many free activities allows you to direct funds toward priorities like housing. Home ownership, though a large investment upfront, may ultimately pay dividends through San Diego's consistent property value growth. So by being savvy and flexible with your lifestyle, the high cost of living can be offset by the unbeatable weather, food, culture and natural beauty that make it so sought after. With some effort, the California dream can be within reach.


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