What’s the Most Expensive City in California?

An image of a Beverly Hills sign. Lights on both sides, trees behind it, and sunshine coming through the trees.

The Golden State; home to sprawling beaches, beautiful forests, and Hollywood. There is no doubt about the allure of California. For some people, it’s the year-round good weather, and for others, it’s the glamor and celebrities that draws them in. 

California is home to everything from some of the most renowned military bases to popular TV reality shows based in West Hollywood. However, if there is one thing that can be said about the state as a whole, it is that the cost of living is exponentially higher than in other states. 

For example, the average home price in the United States is about $291,700, while the average home price for the state of California is $686,800. Housing prices make the Californian cost of living exponentially higher than the national average.

But which city is the most expensive in California? Let’s find out. Several different cities could be considered the most expensive, depending on the source. Here we will examine various aspects of a few. Many of these will surely ring a bell

1. Beverly Hills

Beverly Hills is one of the world’s most famous cities, so I don’t think there is any surprise here. Like the band, Weezer said, “Beverly Hills, that’s where I want to be.” World-class shopping on Rodeo Drive and some of the most exquisite homes in the Los Angeles area draw in celebrities and business magnates. 

Does 90210 ring a bell? Although it shares a name with a popular television show, it is actually one of the most exclusive and expensive neighborhoods in Beverly Hills, full of magnificent mansions and high-end shopping. 

Located in Los Angeles County, Beverly Hills has a population of approximately 33,792. The median home price is about 3.75 million. Strangely enough, the top fifth of income earners in Beverly Hills brings in a whopping average of $661,000, while the lowest portion of earners brings in only $14,500. 

Downtown Beverly Hills is known for its high-end designer shopping. In fact, it has been the center for high fashion in the Los Angeles area since it overtook Hollywood in the mid-1900s.

According to BestPlaces, the national average rating for the cost of living in any particular city is 100. BestPlaces lists Beverly Hills with a rating of 546.2, putting it significantly higher than the national average. 

2. Malibu

For decades Pop Culture has fantasized about Malibu as a dreamland fit for only celebrities and the wealthy. It is located along the Pacific Coast Highway and features a rocky coastline and gorgeous beaches. 

Malibu boasts sprawling beaches, such as Zuma Beach, that are near popular shopping and fine-dining locations. For those who fancy a more “in touch with nature” experience, Point Dume State Beach and Preserve offers low-key hiking and diving spots. 

With the national average factor of 100, BestPlaces rates Malibu at 483.9. For illustration and keeping in mind the same national average factor of 100, the housing cost rate for Malibu is a whopping 1303.8, with an average home price of about $3.7 million. 

3. Palo Alto

An aerial view of Palo Alto. You can see buildings and businesses with trees. Mountains and clouds in the backdrop.

Have you ever heard of Silicon Valley, the breeding den for tech giants such as Apple, Google, and Facebook? Well, Palo Alto is widely regarded as the birthplace of Silicon Valley. A quick look at the hyper-successful companies and entrepreneurs that have come out of Palo Alto leaves no question as to why it is one of the most expensive zip codes. 

BestPlaces gives Palo Alto a cost of living rate of 471. This rating is mainly due to housing costs, with an average home price of 3.3 million. Interestingly, a few of the other cost of living categories are on par with or slightly below the national average. Utilities get a rating of 89.9, making it below the national average. Healthcare costs are just slightly above with a 100.5 rating. 

4. Woodside

Home to tech magnates like the late Steve Jobs, Woodside is another influential community in the Silicon Valley area. The town has maintained its small hometown feel regardless of the well-known residents. The small community features numerous hiking trails and other outdoor activities. 

According to BestPlaces, each category factored into the cost of living ranks higher than the national average. The most significant increase is in housing costs. The median home price is listed at just $4 million dollars, giving Woodside a housing rate of 1293.1 and an overall rating of 480. 

5. Los Altos Hills

Settled in between San Jose and San Francisco, Los Altos Hills is known as one of the Bay Area’s best family locations. It is close to the Bay Area as well as Mountainview, where the Google headquarters is located, making it conveniently located to get out of the hustle and bustle but still close enough for a short commute. This makes it attractive for families and high earners at nearby tech companies. 

The BestPlaces ratings for Los Altos blow the others out of the water. The median home price in Los Altos is about 4.8 million dollars. Renters fork out an average of over $7,000 a month for a four-bedroom rent. With the national average factor of 100, BestPlaces gives Los Altos Hills a whopping 667.9.

So Which One is the Most Expensive?

Based on the information that we have evaluated, the fight for the most expensive city in California is between the sleeping giant of the North, Los Altos Hills, and the world-famous Beverly Hills of Southern California. Comparing categories associated with the cost of living such as housing, grocery, and transportation, both cities occasionally over-take the other in average price.

The main set-apart is the average housing cost. Los Altos Hills and Beverly Hills have average home costs of $4.8 million and $3.75 million, respectively. While this is the average home price, both cities have homes listed and sell for wildly more than the averages listed. 

In my opinion, the winner of this debate is Beverly Hills. The high-end shopping, endless gourmet dining, and extravagant housing in the Beverly Hills area put this zip code over the top. As mentioned above, although the median home price in Beverly Hills is $3.75 million, there is no shortage of homes that sell for many times that price. 

In 2020, Amazon Founder Jeff Bezos purchased a magnificent estate in Beverly Hills that closed at an unbelievable price of $165 million. While this is only one example, there is no shortage of high-priced homes in the Beverly Hills area. The upper end of Beverly Hills housing list and sell for tens of millions.  

The popular Netflix reality show Selling Sunset, based in West Hollywood bordering Beverly Hills, outlines countless high-priced and over-the-top Beverly Hills living examples. The show has historically listed homes for as high as $75 million. 

The national average salary in the United States is about $50,000. This same salary in Beverly Hills would get you about as far as a salary of $8,000. This means that a $50,000 salary would need to increase to about $310,000 in order to simply maintain the same standard of living in Beverly Hills as the national average. 

Related: Pros and Cons of Living in California