California Historical Cost of Living Report

As one of the world’s largest economies, California was once known for its vibrant business environment but also its high cost of living. This analysis delves into key metrics shaping California’s cost of living from 1940 to 2023.

We scrutinize historical trends in household income, rent, home prices, and mortgage payments to create a comprehensive picture of economic changes in the state. This report offers a unique opportunity to understand the economic dynamics of California, offering insights valuable to residents, policy-makers, and economic enthusiasts alike.


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Historical Median Household Income in California

Charting the course of California’s economic journey, we see that the state’s median income has made considerable strides over the past half-century. In 1969, the typical Californian earned $9,302 annually, a modest figure by today’s standards.

This figure increased considerably in the ensuing decade, more than doubling to $18,243 by 1979. The upward trend remained consistent through the 1980s, with incomes seeing an overall increase despite some years of slower growth. The median income broke the $30,000 barrier for the first time in 1987, reaching $33,290 by the end of the decade in 1990.

The 1990s saw a continuation of this upward trajectory, albeit at a relatively slower pace, with median income hitting $43,629 by the end of the decade in 1999. The turn of the millennium ushered in a period of modest growth, and by 2005, median income had risen to $51,755.

In the decade that followed, incomes climbed further despite economic challenges, including the financial crisis of 2007–2008. Notably, the median income crossed the $50,000 threshold in 2006 and continued to ascend to $57,014 in 2008. After a few years of stability, the median income began a steady climb once again, reaching $63,636 in 2015.

The most recent years have seen the most robust growth yet, with median income surging to $78,105 in 2019, $81,575 in 2021, and reaching an all-time high of $84,097 in 2023.

California Historical Income Taxes

Over the past two decades, the combined tax burden in California for median earners, which includes state, federal, Social Security, and Medicare taxes, has shown a slight decrease. From a combined tax rate of 27% in 2002, the figure dropped to 26% in 2012 and stands at 25% in 2023, reflecting a marginal but consistent reduction.

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This tax trend is intriguing as it highlights a gradual reduction in tax burden for California’s median earners over the years, which is somewhat counterintuitive considering California’s reputation for high taxation. It suggests an evolving tax policy that may aim to support middle-income individuals, an often-overlooked but essential segment of the population in the state’s economic landscape.

Historical Rent in California

In the landscape of California’s housing market, one of the key trends is the persistent increase in the median rent over the years. Reflecting back to the 1940s, Californians were spending a mere $27 a month on rent, a figure that equates to approximately $446 in 2023 dollars.

This trajectory was maintained as the state moved into the 1950s with median rent nudging up to $42 ($554 in 2023 dollars). The trend continued through the 1960s, with median rents pushing up to $79 ($801 in 2023 dollars) and further up to $126 ($1,064 in 2023 dollars) in the 1970s.

Californians witnessed a more notable hike in their median rent costs in the 1980s as rents rose to $283 ($1,374 in 2023 dollars). This trend gained further momentum in the 1990s, pushing median rents to $620 ($1,760 in 2023 dollars). Interestingly, despite an increase in nominal rent to $747 in 2000, the inflation-adjusted value actually decreased slightly to $1,595, pointing to the economic dynamics of the time.

The new millennium brought a resurgence of upward momentum. By 2010, Californians faced median rents of $1,163, or $1,831 when adjusted for inflation to 2023 dollars. Fast-forward to 2020, and the median rent increased to $1,586, roughly equivalent to $1,824 in 2023 dollars, demonstrating only a slight decrease in real terms.

However, the most recent years have seen a surge in both nominal and real rent values. In 2021, the median rent stood at $1,750 ($1,969 in 2023 dollars) and rose again to $1,844 ($1,956 in 2023 dollars) in 2022. As of 2023, Californians are facing the highest median rent ever recorded at $1,930, equating to the same value in 2023 dollars.

Historical Home Price in California

Looking back over the decades, we see an intriguing pattern of growth in California’s median home values from 1940 to 2023. Commencing with a median home value of just $3,527 in 1940, the trajectory of home values in California has been, almost without exception, one of ascension.

By 1950, the median home value had risen slightly to $9,564. However, it was the 1960s that marked a significant step forward, with the median value increasing to $15,100. This momentum carried into the 1970s, as the median home value shot up to $23,100.

The 1980s witnessed an even more dramatic surge, with median home value reaching $84,500. By 1990, this figure had more than doubled, landing at $195,500.

The turn of the century saw the continuation of this growth trend, though at a slightly slower pace. The median home value in 2000 was $211,500. The most substantial increase occurred over the following decade, with the 2010 median home value recorded at $358,800, marking an increase of approximately 70% from the 2000 figure.

In 2023, the median home value reached a remarkable $684,800, indicating a near doubling of the home value since 2010. This figure underscores the rapidly increasing costs of homeownership in California over these years.

California Historical Monthly Mortgage Payments

Over the years, the median home price in California has seen considerable changes, thereby affecting the average monthly mortgage payments. In 1970, when the median home price was $23,100 with a 20% down payment of $4,620, the loan amount was $18,480. At a rate of 7%, the monthly mortgage payment was a mere $124.

Jumping a decade ahead to 1980, the median home price more than tripled to $84,500. Consequently, with a 20% down payment of $16,900 and a loan amount of $67,600, the monthly mortgage payment increased to $787 at an interest rate of 14%.

By 1990, the median home price had increased further to $195,500. With a down payment of $39,100 and a loan amount of $156,400, the monthly mortgage payment was $1,388 at an interest rate of 10%.

Moving into the new millennium, the median home price reached $211,500 in 2000. The down payment was $42,300, and the loan amount stood at $169,200. Despite a higher interest rate of 8%, the monthly payment decreased slightly to $1,247 due to a lower loan amount.

In 2010, the median home price saw a significant increase to $358,800. With a down payment of $71,760 and a loan amount of $287,040, the monthly mortgage payment was $1,487 at a 5% interest rate.

Fast forward to 2023, the median home price in California reached a staggering $684,800. With a 20% down payment of $136,960 and a loan amount of $547,840, the monthly mortgage payment hit an all-time high of $3,689 at a 7% interest rate.


Bureau, U. C. (2022, August 18). Historical income tables: Households.

iPropertyManagement. (2021, October 26). Average Rent by Year [1940-2021]: Historical Rental Rates.


Home Value and Homeownership Rates: Recession and Post-Recession Comparisons. (2007).

Median Home Prices By State For 2022. (n.d.).

Historical 30 Year Fixed Mortgage Rates From the 1970s to 2020. (n.d.).

State. (2000).

The Average Cost of Rent in Every State. (2021, April 14). GOBankingRates.

Rent price inflation, 2010→2023. (n.d.).

Housing price history from 1967 through 2020. (n.d.).


In this study, we meticulously gathered and analyzed data from a range of esteemed and authoritative sources. Central to our inquiry is the extensive household income data from the US Census Bureau’s “Historical Income Tables: Households.” Concurrently, iPropertyManagement’s “Average Rent by Year [1940-2021]: Historical Rental Rates” enriched our understanding of the historical trajectory of rental rates.

To delve into the nuances of housing affordability, we utilized reports from and the Pacific Research Institute. The former offered an enlightening dataset on housing values, while the latter provided vital information on the state’s income tax rate. Additionally, the Census Bureau’s report on “Home Value and Homeownership Rates: Recession and Post-Recession Comparisons” offered pivotal insights into the housing landscape over time.

Detailed mortgage rate data from RocketMortgage’s “Historical 30 Year Fixed Mortgage Rates From the 1970s to 2020” guided our understanding of historical mortgage trends. Lastly, we drew upon information from GOBankingRates and to gain insights into rental costs and inflation rates in California.