Rent and Salary in California 2023

This post works backwards from the cost of a small 1 bedroom in Santa Barbara to what you would have to make per hour if you were a part time worker.  

It is said that a person should spend approximately 1/3 of their income on housing, be that rent or mortgage.  It isn't all that clear to me whether this recommendation is before or after taxes, so we will examine both.  It is believed that Santa Barbara is expensive and that may be so, but it is only slightly pricey relative to many other parts of coastal California.  And of course California is expensive in various ways but also has a lot of advantages.  So we will work with Santa Barbara and then suggest an adjustment factor if you happen to be living in another state outside of a major metropolitan area.

Rent for a 1 bedroom in Santa Barbara in 2023 starts about $2,500 / month which means you would have to make a salary of $7,500 / month to live here or $90,000 / year.  Now federal and state taxes on $90,000 in California is about $25,861 / year which reduces your net salary to $64,139 or $5,345 / month.  If we take rent out of that it will leave $2,845 / month for all other expenses be they food, medical, savings, education, debt, and so forth.  

But I think when they say 1/3 of your salary on rent, they mean 1/3 of your net salary, which translates to approximately $135,000 / year gross salary.  This will leave the individual $5,000 / month for all other expenses and savings which seems reasonable.  

So lets take these two numbers ($90,000 and $135,000) as the limits of our calculations.  How much must you make per hour to live in Santa Barbara.  Well, if you are full time that would mean 52 weeks of 5 days per week or 40 hours a week.  That would mean 52*40 which is 2080 hours per year.  At 90,000 $US you would need to make approximately $43/hour.  To make $135,000 you would need to make about $65/hour.  

But the reality is that most people who are freelance do not work 40 hours a week all year long so they would need to make more than this per hour when they are working to support themselves.

Therefore we now know what one needs to make to live in a minimum place in Santa Barbara and that is between $43 and $65 per hour.   Maybe you live in Providence, Rhode Island or Eugene, Oregon in which case you might adjust these numbers down by as much as 1/3. 

Last time I checked minimum wage or Walmarts salaries were no where near that amount.  Do the math, government, and tell me what you think people should do.

Looking to Rent a Monk's Cell

270 Riverside Drive Apt 12A New York City

When I lived in NYC in the 1990s I was lucky enough to live in some spectacular apartments.This is all due to friends who welcomed me to New York and made it possible for me to stay there when by rights I should have had to leave. One of these apartments was on Central Park West in the upper west side.  The other was on Riverside Drive at 99 and Riverside.

This apartment was on the top floor of the building with a view of the Hudson from almost every room. It was, they tell me a classic eight (or seven?) with four bedrooms, three baths, a formal dining room, a living room, a study and my office (the former maid's room). One of the bedrooms was allocated for our guests, something that is quite rare in Manhattan where space is at a premium.

This apartment had been rent controlled for decades and the person who had the lease was very generous with those he sublet rooms to and I only had to pay my share of the total reduced rent. Ultimately he became a victim of his own pride in a dispute with the landlord and lost his lease so we all had to leave.  The place needed to be fixed up (it is an artifact of the rent control laws that such apartments are allowed to grow more decrepit) and I always wondered what it would rent for (or sell for if in a coop situation).

Thanks to the power of the bold, new Internet paradigm, we can easily find out. The apartment is listed on Zillow at about $6.8 million (see here for the Zillow listing).

If you look at the pictures in this listing, you would have no idea how completely wonderful this apartment is and what it was like to live there. Part of the reason for this is that they did not photograph the place to show you its environment and they made other mistakes as well.  Here are some photographs that may correct this impression and give a hint of the grace conferred on those who lived there.

View out one of the windows

On the street where you live

At night

Snow