Cost of Living in Palo Alto, California

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Palo Alto is home to the world-renowned Stanford University, several big tech companies, and is one of the wealthiest zip codes in America. Despite all these world-famous attributes, the town keeps a laid-back atmosphere and many neighborhoods have a tight-knit community. Let’s analyze the pros and cons of this tech town. 

What is the cost of living in Palo Alto, California?

Cost of living refers to goods and services you spend money on in order to maintain your lifestyle. This includes aspects like healthcare, rent, entertainment, food, and transportation. Palo Alto is significantly more expensive than most cities in the country. On an average U.S. score of 100, Palo Alto receives a 471. To put this number in perspective, it is cheaper to live in London, New York, or Los Angeles than it is to live in Palo Alto. The biggest expense is housing.

Luckily, Palo Alto’s average income exceeds the national average, helping offset the high cost of living. Palo Alto is home to one of the biggest tech companies in the world that employs many people living in the area. The median income per capita is $74,582, with the median household income at $122,482.

How expensive is an apartment in Palo Alto, California?

Here are the average rental rates for an apartment in Palo Alto:

  • Studio apartment: $1,895
  • One-bedroom apartment: $2,515
  • Two-bedroom apartment: $3,295
  • Three-bedroom apartment: $4,498
  • Four-bedroom apartment: $6,500

As these are the average rates for the entire city, remember that rates will change depending on your location. Areas near the downtown like College Terrace and Crescent Park will have higher rates than neighborhoods on the outskirts of the city, such as Alta Mesa and Palo Verde. 

There are other costs to consider when renting an apartment other than the base rental price. You will need to check with your landlord and ask about all fees associated with living in the apartment or home. Most landlords will require a security deposit in case you do any damage to the apartment while you’re living there. This usually costs about one month’s rent. There may be other fees, including parking fees and renter’s insurance. Ask your landlord about these fees before signing so there are no surprises when moving into your new apartment.

You also need to consider moving costs. Whether you hire a moving company or do it yourself, you will need to factor in the time and money necessary to move your things into your new space. 

How do I find cheap apartments in Palo Alto?

Sharing an apartment or home with roommates is an excellent way to save money in Palo Alto. Housing is the highest expense in this area and, while sharing a bathroom may not be your ideal living situation, splitting the rent costs with 3 or 4 people can make living in Palo Alto much more reasonable. Palo Alto has many big companies filled with young professionals. Think about finding a roommate who works in the same general area as you so you can also share transportation costs or commute together.

Gas and parking fees can be quite high in Palo Alto, so it’s a good idea to live near public transportation. A monthly pass on the Caltrain costs about $100 a month and can take you as far a San Francisco. If you are living or working at Stanford University, the Marguerite Shuttle offers free service to the university, Stanford Shopping Centre, and the Caltrain station. Palo Alto is also a bike-friendly city so biking to work and the grocery store is quite easy in most neighborhoods. 

What is the cheapest rent in Palo Alto?

There are 36 neighborhoods in Palo Alto. The most expensive neighborhoods in Palo Alto are College Terrace, Foothills Open Space Preserve, and Palo Alto Hills Golf and Country Club. Most neighborhoods have a mixture of apartment complexes and historic homes for rent. Here are the more affordable neighborhoods:

  • University South: This almost urban neighborhood has a diverse mixture of students, families, and young retirees. The neighborhood is almost split 50/50 between renters and people who own their home. The average cost for a two-bedroom apartment is $3,242. It’s near public transportation such as the buses and Caltrain. It’s a 35-minute walk to the Stanford campus and there are many grocery stores, libraries, and coffee shops, all within walking distance of most homes. 
  • Ventura: Ventura is an eclectic neighborhood that attracts people from all areas of life. The neighborhood is home to a diverse number of professionals, including artists, architects, and a variety of other jobs. Young professionals in the tech industry are not the dominant population here. The average cost for a two-bedroom apartment is $3,062. It’s a walkable neighborhood with tons of small, local businesses to support. 
  • Midtown Palo Alto: Located roughly in the middle of Palo Alto, this area has excellent schools, beautiful parks, and general walkability. Unlike the major downtown area, Midtown is quiet, with its own shopping district that includes a grocery store and many restaurants. The average cost for a two-bedroom apartment is $2,600. It’s a great neighborhood for families concerned about schools and having access to parks. It’s also great for young professionals who can walk to the Middlefield & Webster train stop and head into the main city. 
  • Barron Park: This semi-rural neighborhood in south Palo Alto is a relatively quiet community. You can rent anywhere from an apartment to a small cottage, or even a mobile home at the Buena Vista Mobile Home Park. The average cost for a two-bedroom apartment is $3,365. There’s a great bike path in Cornelis Bol Park that people use for leisure, and a way to commute to Stanford Research Park.

No matter if you’re a brand-new family looking for a close-knit community or a young professional who wants to live near public transportation, there is a home in Palo Alto that’s right for you. As long as you stick to your budget and analyze what you need in a living space, you can find a place to call home in Palo Alto. 

Browse Palo Alto apartments and homes for rent on Zumper and get ready to call this city home.

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