New Jersey No Longer Cheaper Than NYC for Families as Costs Soar
A significant increase in childcare, housing, and healthcare expenses has erased the cost advantage for families moving from New York City to New Jersey.
Families looking to move from New York City to New Jersey in pursuit of lower living costs may find that advantage has all but disappeared. The cost of living in New Jersey has surged by $40,800 for families since the pandemic, driven by substantial increases in childcare, housing, and healthcare expenses. Over the past six years, costs in New Jersey have risen by approximately 38.2%, according to data from the Living Wage Institute.
In contrast, the cost of living in New York increased by 25% and in Pennsylvania by 30% during the same period. This shift has led some families to find New Jersey more expensive than New York for raising children.
Kristyna Frantz, who relocated from Washington Heights to Fanwood, New Jersey, in 2024, told Bloomberg that her family is now paying more for childcare, commuting, and their mortgage than they did for rent in the city. She noted that their monthly childcare costs for three children amount to $5,000, an expense that would have been $1,000 less if they had remained in the city, where their eldest child was enrolled in a free municipal program.
Childcare in New Jersey has emerged as a major financial burden, with costs increasing by 57% statewide since 2021. Housing prices have also seen a significant rise, up 37.5% since 2021, while healthcare costs have jumped by 55.5% in the same timeframe. The overall annual increase in the cost of living in New Jersey stands at 6.7%, notably higher than the national average of 4.5%.
The increased competitiveness of the housing market during the pandemic is cited as a contributing factor to these rising costs. According to Jeffrey Otteau, chief economist of his real estate firm, areas in New Jersey that were once affordable for families establishing roots outside the city are no longer so. He stated that for households earning $150,000 or less, New Jersey may no longer be an "affordability safe haven."
Overall, the growth in childcare and healthcare expenses in the state has more than tripled since 2023. Sharon Levine, campaign director for the childcare advocacy group Start Strong NJ, highlighted that for many young families in New Jersey, childcare is now their largest expense, sometimes exceeding mortgage or rent payments.