California is known for its high cost of living, and there are many factors that contribute to this. From taxes and regulations to the demand for popular parts, the Golden State has some of the most expensive housing in the country. In addition to the high cost of living, many people also associate expensive living and luxurious lifestyles with Hollywood. But why is California so expensive and what are the key costs you will face if you consider moving there?It's complicated, but two of the main factors influencing the cost of living in California are taxes and regulations.
California is known as a liberal stronghold in the United States, which is why it implements many environmental regulations. Between regulations and a high federal consumption tax, California pays the most in the country for gasoline. The state of California also has some of the highest base sales tax rates, 7.25%, and cities can also add their own so that Los Angeles sales tax rates are 9.5%.In addition, construction labor is approximately 20 percent more expensive in California's major cities than in the rest of the country. Environmentally friendly building codes and design requirements in many California cities require the use of different types of construction raw materials, some of which may be more expensive than in other parts of the country.
It is estimated that there is up to 30% less supply of housing units compared to demand in California. Foreign buyers, mainly from China, have also increasingly fallen in love with California real estate. With 840 miles of coastline, it's no wonder why people want to live next to the beach. It is a unique state that presents many desirable aspects that attracts a significant number of people. Of course, more people want to live downtown or a short commute from work, so the more a city extends, the more the price of housing increases. In addition to housing costs, other key costs you will face if you consider moving to California include groceries and utilities, gasoline prices, and healthcare costs.
California ranks 23rd in access to healthcare and affordability. It's well known that celebrities build their homes in California due to its luxurious lifestyle. But with high taxes and regulations, expensive housing costs, and limited supply of housing units compared to demand, it's no wonder why people are drawn to this state despite its high cost of living.
