From the architecture and history to the food and music, it’s no wonder people want to move to the Big Easy. But can you really afford to live in this awesome city?
New Orleans is a city known for its cultural diversity, gorgeous architecture and amazing job opportunities — including jobs in some of the best sectors in the country (aerospace, defense and tourism just to name a few). Besides that, New Orleans has a fun vibe that you just can’t find anywhere else.
Such perks often make a city more expensive to live in than average. How does New Orleans measure up?
The cost of living in New Orleans is 12.9 percent higher than the national average, up 1.8 percent from last year. While higher, that percentage is low compared to other cities in the South, like Arlington, VA, which is 52.2 percent higher than the national average.
If you’re interested in moving to New Orleans, you need to look at multiple factors to determine whether the cost of living fits your budget. One important area is the average rent in New Orleans. Besides that, you’ll also want to look at the following costs, which we break down in this post.
Housing costs in New Orleans
Your single greatest expense when it comes to the cost of living in New Orleans is housing. That’s not to say that the average rent in New Orleans is exorbitant. It’s just that most people allocate at least 30 percent of their monthly budget to their housing needs. So, finding out the average cost of rent in the area in which you want to move will help you determine if you can truly afford to live in that city.
The average rent in New Orleans is $2,712 per month, an increase of 16.1 percent in the past year. That price is 43.8 percent higher than the national average. What’s driving the higher prices? Realtors in the area blame the increase on the higher cost of building supplies like lumber, as well as an increase in taxes, utilities and insurance. They also point to the lack of rental volume — there are fewer rental opportunities in this city than in similar-sized cities across the nation.
That’s not to say that every apartment or rental opportunity in the city is out of budget. The $2,712 cost is an average, so there are lower and higher options throughout the city depending on which neighborhood you choose.
Rentals in the French Quarter, for example, can cost upwards of $3,191 per month. It’s no surprise as this neighborhood is close to all the bigger city amenities and is one of the most famous neighborhoods in the country. On the other hand, if you choose to find a rental in Old Aurora or Algiers, you can pay significantly less ($1,284 per month).
If you can’t shake the idea of living anywhere but New Orleans, it’s very possible to find an apartment within budget — one that’s even below the current average rent in New Orleans.
Average rent prices in cities near New Orleans
Living in a great city in Louisiana doesn’t mean you have to go over budget. There are several beautiful cities, some within a few minutes of New Orleans, where rental fees are a third of what they are in the Big Easy. If you don’t need to live in New Orleans but want to be within driving distance, consider apartments for rent in the following cities.
Home prices in New Orleans
Real estate experts say now is the perfect time to buy a home in New Orleans because, according to their estimates, properties will appreciate both in the short and long term. In fact, over the past 10 years, real estate in New Orleans has appreciated by more than 46 percent — an average of nearly 4 percent per year. This appreciation rate is within the top 30 percent nationwide.
Another reason to consider buying a home is that mortgage rates are lower than ever. And it might be easier to find a home to buy than it is to find an affordable rental. According to Redfin, the housing market is not very competitive right now, which means it’s a buyer’s market. At this point, multiple offers are not the norm and the average home sells for at least 2 percent below market value.
The average cost of a home in New Orleans is $357,000, an increase of 17 percent in the past year (the average cost of a home in the French Quarter is around $18,000 more). According to NerdWallet, if you put down $60,000 as a down payment (17 percent) and qualify for a 30-year loan, you’ll pay $2,037 per month for the average home in New Orleans — $675 less than the average rent in New Orleans and $1,154 less than rent in the French Quarter.
Food costs in New Orleans
Food is an important part of the New Orleans lifestyle. Breaking bread with friends and family is an enjoyable experience that draws people closer together. And with all the great eatery options you have in the city, we’re guessing eating out is something you might want to do as often as possible.
New Orleans is well-known for its Indigenous and Cajun cuisine, as well as international options, including French, Spanish, German, Italian and African.
Even if you’re not a self-proclaimed foodie, you’ll want to figure food and dining prices into the cost of living in New Orleans.
A budget dinner out in the city can cost between $10 and $16 per person. However, if you choose to eat at a fine dining or specialty restaurant, the prices range higher.
Grocery costs will figure into the cost of living in New Orleans, as well. Thankfully, food costs are just slightly above the national average (+1.2 percent). Depending on the type of food, you can end up paying a few cents more or even a few cents less than other cities in the country.
For example, a steak in Louisiana costs around $12.23, while the national average is $12.40. Sausage in New Orleans costs $4.76. The national average is $4.10. What about fresh fruits and vegetables? Buying lettuce or peaches in New Orleans can cost $1.69 and $2.01, respectively. In other cities, you’ll pay around $1.52 and $1.93 respectively.
Utility costs in New Orleans
Something that can drastically raise the cost of living in New Orleans is utility fees. In many cases, the average rent in New Orleans does not include utility costs. These are separate fees that you need to figure into your budget.
Unfortunately, there’s not a hard-and-fast number that you can calculate into your budget. Utilities depend on usage. One thing we do know, though, is that the average cost of utilities in New Orleans is well below the national average by nearly 26 percent.
Typically, it’s the long, hot, humid summers that cause increases in power rates due to the increased usage of air conditioning. Monthly power bills average $96.43. Other utilities, like phone and internet, can cost approximately $184.52.
Before making your move, talk to utility providers (phone, internet, power, cable) to find out how much their costs can increase the cost of living in New Orleans. Tell them which neighborhood you’re looking into and the size apartment you’ll rent and they can provide an estimate.
Transportation costs in New Orleans
Transportation is an important factor in determining which neighborhood you’ll live, as well as your cost of living in New Orleans. If you choose to live near your place of employment, you’ll likely have lower transportation costs. But if you choose to live on the outskirts of New Orleans and your job is Downtown, you’ll probably have to pay more.
Overall, transportation costs are 3.6 percent less than the national average.
There are so many ways to get around New Orleans. With a walking score of 72, you can accomplish a lot on foot in this city. The bike score is higher than average (75) because of the fairly flat terrain and well-marked bike lanes.
Other ways to get around the city include historic streetcars and the New Orleans Regional Transit Authority (NORTA). A one-way fee on a streetcar and a NORTA bus is around $1.25. You also have the option to buy multi-day (1-day, 3-day-, 5-day or 31-day) passes for a flat rate, which includes unlimited rides.
If you’re using your own car, you’ll need to be aware of the following costs:
- Gas: $2.56 per gallon — 7 percent cheaper than the national average ($2.75).
- Parking: Price depends on the lot. You can pay between $4.45 and $21 per hour.
- Maintenance: Tire balancing can cost $55.66, which is 6.03 percent higher than the U.S. average ($52.40).
- Tolls: Between $5 and $23 depending on the number and size of axles on a vehicle.
Healthcare costs in New Orleans
It’s not always easy to estimate how healthcare fees will figure into the cost of living in New Orleans. Healthcare is a very individual thing and depends on multiple factors. Are you single, healthy and only need to pay for annual visits to the doctor, dentist and optometrist? If so, your healthcare costs are going to be considerably less than someone with children and/or a chronic illness.
Overall, the healthcare costs in New Orleans are 19.2 percent higher than the national average. Following is a breakdown of what that might look like for annual health check-ups.
- Doctor: $158.33 in New Orleans and $112.81 nationally = 33.6 percent higher in New Orleans
- Dentist: $120 in New Orleans and $99.44 nationally = 18.74 percent higher in New Orleans
- Optometrist: $103 in New Orleans and $105 nationally = 1.9 percent lower in New Orleans
Another cost to factor into the cost of living in New Orleans is medications. Over-the-counter medications (like ibuprofen) cost around 17.07 percent more here than the national average, while prescription costs are approximately 6 percent higher than the U.S. average.
Goods and services costs in New Orleans
Non-essential items fall under the goods and services category. Depending on how much you spend on these items and how often you purchase them will determine how extensively they increase your cost of living in New Orleans.
Goods and services cost 6.6 percent more than the national average, an increase of 0.05 percent over last year.
These types of services include a trip to the barber for a haircut (on par with the national average of $20) or to the salon ($38.64 national average; $48.33 in New Orleans). Or, if you want to see a movie ($11.99 in New Orleans; $11.12 national average) or attend a yoga class ($15 national average; $20.67 in New Orleans).
Oftentimes, people forget to figure these fees into their budget, which can lead to a rude awakening. When you’re figuring out the cost of living in New Orleans, don’t forget to add the costs of some of your favorite pastimes, regular treats or necessary-though-not-essential services.
Taxes in New Orleans
Louisiana has a state sales tax (general use tax) of 4.45 percent. However, depending on where you live, the total sales tax rate can increase by another 7 percent. So, if you spend $1,000 on a product in the state, you can pay an additional $44.50 to $70.00 in sales tax. Currently, the sales tax rate for New Orleans is 5 percent. State income tax in New Orleans is 6 percent, which is 1.4 percent higher than the national average.
How much do you need to earn to live in New Orleans?
If you decide to spend 30 percent of your income on rent, approximately $32,544 of your income will go to your landlord each year. The median household income in New Orleans is $41,604. Obviously, spending 30 percent on rent and paying the average rent in New Orleans is out of a lot of people’s budgets.
However, you don’t necessarily need to spend 30 percent of your budget on the average rent in New Orleans. If you can cut down on other costs like transportation, eating out, etc., you may have more money in your budget for rental fees.
Don’t forget, too, that there are multiple neighborhoods in New Orleans where the average rent is much lower. And if you have a higher-than-average-paying job (physician, pilot, engineer, sales manager, health and safety inspectors, etc., according to USAWage.com), you can make ends meet even easier.
To find out if you can afford the average rent in New Orleans, make sure to check out our free rental calculator.
Understanding the cost of living in New Orleans
If you want to live in a city with a rich history and heritage, New Orleans is the place for you! With annual Mardi Gras celebrations, amazing eateries and beautiful people, visitors to this fine city are quickly hooked on the beauty and atmosphere. And with the diverse range of employment opportunities and a lower-than-average cost of living, New Orleans is one of the best places to live on the Gulf Coast.
If you’re ready to call New Orleans home, check our listings to find apartments for rent in New Orleans to find your dream rental.
Cost of living information comes from The Council for Community and Economic Research.
Rent prices are based on a rolling weighted average from Apartment Guide and Rent.com’s multifamily rental property inventory of two-bedroom apartments as of August 2021. Our team uses a weighted average formula that more accurately represents price availability for each individual unit type and reduces the influence of seasonality on rent prices in specific markets.
The rent information included in this article is used for illustrative purposes only. The data contained herein do not constitute financial advice or a pricing guarantee for any apartment.
Source: rent.com