Baby, You're Expensive! - Redfin Real Estate News

Baby, You’re Expensive!

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Updated on October 6th, 2020

The Duke and Duchess of Cambridge have a lot on their plates these days with the arrival of Prince George. Unlike most people, William and Kate do not need to worry about the financial costs and the 1,200 royal staff should also help ease the burden. For the rest of us, starting a family can be a huge financial challenge. Between home preparation, long nights, diaper changes, and feedings, parents can easily overlook the endless tab they are about to rack up thanks to their new little bundle of joy.

A million dollar baby is probably a stretch, but over the 18+ years you raise your child, you might come close. In the U.S., the average cost for a baby’s first year comes out to about $26,000 if you upgrade your house, use daycare, have insurance and buy the typical things parents buy. This report will present these costs throughout the United States to help prepare you for the financial side of raising a baby.

Cost of a baby's first year in the United States

In our analysis, we broke down costs into five main categories:

  • Housing – Cost of an additional bedroom in your city
  • Childcare – Cost of 9 months of infant childcare in your city
  • Healthcare – Out-of-pocket expenses for prenatal, childbirth, and first year
  • Baby items – Cost of diapers, food, toys, strollers, and other supplies
  • Energy – Additional cost for more laundry, a warmer house, drives to see family

Housing

Accommodating a kid or two will require something more than your two bedroom condo at the center of the the city. We have calculated the average cost of upgrading from a two-bedroom home to a three-bedroom home in your city. The average cost of an additional bedroom is about $86,000 or about $7,600 per year in additional mortgage payments (on a 30-year fixed 4.5 percent loan). San Jose is the most expensive place in the nation with an additional bedroom costing $225,000 or $20,000 per year. On the other end of the spectrum, an additional bedroom in Las Vegas will only run you $44,000, or $4,000 per year.

Childcare

Childcare is another hefty bill. Redfin combined National Association of Child Care Resource and Referral Agencies childcare costs by state with childcare worker salaries by metro from the Bureau of Labor Statistics to get a more localized estimate of childcare costs by city. Since childcare doesn’t typically start until the baby’s third month, we estimated childcare costs for nine months of the year. Throughout the nation, infant childcare costs on average around $1,000 per month, or about $9,000 for the first nine months of care. Boston leads the country in childcare costs at $14,400 for the first year, and Atlanta is the most affordable at around $5,000 for the first year of care.

Healthcare

Healthcare costs are the great wildcard for babies in the United States. Your geographic location, choice of maternity hospital, insurance status and medical complications can all have a huge impact on the cost of pregnancy and childbirth. Costs can vary from hundreds of dollars for the well-insured to tens of thousands of dollars for the less-insured or uninsured. For the purpose of this analysis, we have chosen a flat $3,000 out-of-pocket cost for a new baby based on a study by Childbirth Connection from January 2013. Although healthcare costs will vary by city, it was difficult to decipher the magnitude using publicly available data. The best data we could find was courtesy of the Center for Medicare & Medicaid Services, but unfortunately it does not include any obstetrics related healthcare costs.

Baby items

Now we’re getting to the costs with which parents are most familiar with. These costs are incurred when you go to the store and pick up a few items for the baby’s new room, or head down to the drugstore to stock up on diapers. Once again, we chose a flat cost here based on Baby Center’s cost calculator. The cost of baby items during the first year is estimated to be $5,500, but can vary based on how many gifts or hand-me-downs you get, as well as general costs of goods in your area.

Energy

Energy costs might not be too substantial compared to the costs above, but they can add up depending on the season, and your location. You’re going to be home more, and you’ll probably have the heat or the air conditioning on a bit longer to keep things comfortable for the baby. You’ll also be making a few extra trips to the store or to see grandma and grandpa. We’re estimating this cost based housing costs supplied by the US census. For the first year, these costs vary from $500 to $1000 depending on your city.

Location, location, location: Cost of a Baby’s First Year by City

Some cities cost more than others for housing, childcare, and energy, while baby items and healthcare are constant. We’ve broken out these first year baby costs by city to give you an idea of what a new baby will cost in your area.

Cost of baby's first year in select US cities

As you can see, having a baby is an expensive endeavor. If you’re not lucky enough to have a staff of 1,200 help you out like Kate Middleton and Prince William, you can still possibly look for a city to call home that tops this list of first year baby costs order by affordability. While this analysis might be a shocker for those sans bébé, as most parents will tell you, the extreme sleep- and cash-deprivation are worth it. We promise.

Cost of a baby’s first year sorted by affordability

Metro Area Total Cost
Chart
Total Cost Housing Child-
care
Baby Items Health-
care
Energy
1. Atlanta, GA
 
 
 
 
 
$18,500 $4,500 $5,000 $5,600 $3,000 $500
2. San Antonio, TX
 
 
 
 
 
$18,700 $4,100 $5,600 $5,600 $3,000 $500
3. Las Vegas, NV
 
 
 
 
 
$19,500 $3,900 $6,500 $5,600 $3,000 $600
4. Houston, TX
 
 
 
 
 
$19,700 $4,900 $5,600 $5,600 $3,000 $600
5. Durham, NC
 
 
 
 
 
$21,100 $5,500 $6,500 $5,600 $3,000 $500
6. Miami, FL
 
 
 
 
 
$21,300 $6,600 $5,500 $5,600 $3,000 $700
7. Austin, TX
 
 
 
 
 
$21,700 $6,100 $6,500 $5,600 $3,000 $600
8. Phoenix, AZ
 
 
 
 
 
$22,000 $6,200 $6,800 $5,600 $3,000 $500
9. Charlotte, NC
 
 
 
 
 
$22,100 $6,500 $6,600 $5,600 $3,000 $500
10. Salem, OR
 
 
 
 
 
$22,400 $5,500 $7,900 $5,600 $3,000 $500
11. Raleigh, NC
 
 
 
 
 
$22,500 $6,800 $6,600 $5,600 $3,000 $500
12. Philadelphia, PA
 
 
 
 
 
$22,600 $5,200 $8,100 $5,600 $3,000 $800
13. Hagerstown, MD
 
 
 
 
 
$22,600 $4,600 $8,900 $5,600 $3,000 $500
14. Bremerton, WA
 
 
 
 
 
$22,700 $5,100 $8,500 $5,600 $3,000 $600
15. Greeley, CO
 
 
 
 
 
$23,300 $3,800 $10,500 $5,600 $3,000 $500
16. Trenton, NJ
 
 
 
 
 
$24,000 $6,100 $8,400 $5,600 $3,000 $1,000
17. Stockton, CA
 
 
 
 
 
$24,100 $5,900 $9,200 $5,600 $3,000 $500
18. Fort Collins, CO
 
 
 
 
 
$24,400 $5,500 $9,900 $5,600 $3,000 $500
19. Riverside, CA
 
 
 
 
 
$24,500 $5,600 $9,800 $5,600 $3,000 $500
20. Modesto, CA
 
 
 
 
 
$24,500 $6,700 $8,600 $5,600 $3,000 $600
21. Chicago, IL
 
 
 
 
 
$25,500 $5,900 $10,300 $5,600 $3,000 $800
22. Baltimore, MD
 
 
 
 
 
$25,600 $6,400 $9,900 $5,600 $3,000 $700
23. Portland, OR
 
 
 
 
 
$25,800 $8,000 $8,700 $5,600 $3,000 $600
24. Sacramento, CA
 
 
 
 
 
$26,300 $8,000 $9,200 $5,600 $3,000 $500
25. Providence, RI
 
 
 
 
 
$26,700 $7,400 $10,000 $5,600 $3,000 $800
26. Salinas, CA
 
 
 
 
 
$27,300 $7,800 $10,300 $5,600 $3,000 $600
27. Boulder, CO
 
 
 
 
 
$27,300 $8,400 $9,800 $5,600 $3,000 $500
28. Seattle, WA
 
 
 
 
 
$27,400 $9,000 $9,100 $5,600 $3,000 $700
29. Denver, CO
 
 
 
 
 
$28,200 $7,700 $11,400 $5,600 $3,000 $500
30. Worcester, MA
 
 
 
 
 
$28,700 $6,300 $13,200 $5,600 $3,000 $700
31. Washington, DC
 
 
 
 
 
$29,800 $9,300 $11,200 $5,600 $3,000 $700
32. Los Angeles, CA
 
 
 
 
 
$30,100 $10,600 $10,400 $5,600 $3,000 $600
33. Oxnard, CA
 
 
 
 
 
$31,400 $12,100 $10,100 $5,600 $3,000 $600
34. Santa Rosa, CA
 
 
 
 
 
$32,000 $11,800 $11,000 $5,600 $3,000 $600
35. San Diego, CA
 
 
 
 
 
$32,700 $13,300 $10,200 $5,600 $3,000 $600
36. Boston, MA
 
 
 
 
 
$34,000 $10,200 $14,400 $5,600 $3,000 $900
37. San Francisco, CA
 
 
 
 
 
$35,900 $15,300 $11,400 $5,600 $3,000 $700
38. New York, NY
 
 
 
 
 
$36,700 $13,400 $13,700 $5,600 $3,000 $1,000
39. Santa Cruz, CA
 
 
 
 
 
$38,800 $19,700 $9,900 $5,600 $3,000 $600
40. San Jose, CA
 
 
 
 
 
$41,600 $19,900 $12,600 $5,600 $3,000 $600
Table Legend
Housing
Childcare
Baby Items
Healthcare
Energy
 
 
Avatar

Tommy Unger

Tommy is a Real Estate Data Analyst at Redfin in Seattle. He brings interesting information and insights to home buyers, sellers, owners, as well as industry experts. Throughout his career working in the real estate and analytics, he's never met a number or chart he didn't find interesting. Tommy grew up in Atlanta, GA and earned a degree in Computer Science from Georgia Tech. With his wife and two kids, you can find him on the Burke-Gilman Trail biking through Seattle, or hiking up in the Cascade Mountains.

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