From Pounds to Dollars: A Comparison of the Cost of Living in the USA vs UK

How much does it cost to move from the UK to the USA?

So, you’ve decided to become one of the 200,000 British citizens each year who make the leap to move abroad…

If the Land of the Free is beckoning, then there are a few things to keep in mind before you make the USA your home. With a few insights into the cost of living in USA, thanks to our cost of living comparison, you’ll have everything you need to make your move a success.

They call the USA the ‘land of opportunity’ for a reason. There are plenty of international companies to work for, and if you have the right skill set, they can sponsor your visa.

In the USA, you can get paid more for doing the same job and with no language barrier, less time is spent adapting to the way of life. Then there are the opportunities for recreation and enjoyment. The sun-soaked beaches, snow-capped mountains, lush forests, clear blue lakes, and vibrant cities seem like a far cry from the rolling green hills of the UK.

If you’re relocating with a family, the USA also has the appeal of top-notch education institutions and living space. If you’ve always liked the idea of living in a house with a perfect green lawn, owning a home in the USA could be your chance. Properties in the USA tend to come with far more living space than in the UK.

Before you make that big move across the pond, you might want to think about the cost of living in the UK vs the US. We can talk about the beautiful landscapes all day long, but there are important considerations about a potential move abroad, like taxes and house prices.

Luckily, we’re here to help with this complete guide to compare the cost of living in the USA and the UK.

Housing Costs Comparison: UK vs USA (2023)

We often hear a lot about the difference between UK and US house prices. Typically this will be the first significant expense that you have after relocating, so it’s worth exploring here.

What’s the cheapest state to live in the USA? Mississippi, apparently. But of course, there is a lot more to take into account when considering where to move in the USA and whether to buy or rent.

Remember, the USA is vast. It is 40 times larger than the UK. With that in mind, the cost of living in the USA fluctuates a lot.

Renting & Buying a Home in the UK vs the USA: Which is Cheaper?

It’s because of the USA’s size that directly comparing living costs isn’t always easy. We can begin with the national averages.

What is the Average House Price in the UK vs the USA?

The average UK property is valued at £294,559, while in the USA, it’s $348,079. After currency conversion, the USA is cheaper by about £5,300.

What is the Average Cost of Rent in the UK vs the USA?

The average rent per month for a one-bedroom flat in the UK is £700. In the USA it is $1,169, which works out to around £940 per month, making the UK a clear winner here.

It’s important to remember when comparing house prices in the UK and the USA that it’s likely that living space will play a big part in whether or not you’re getting value for your money. The average house size in the UK is 76 square metres. In the USA, the average house size is 201 square metres. You will – literally – be getting more bang for your buck.

Let’s dig a little deeper. Considering national averages is a useful start but very generalised. The most obvious first comparison is between the two world cities, London and New York.

London vs New York

In London, the average house price is £523,666. In New York, we can find average house prices of $782,365. This works out to around £120,000 more after conversion. These two cities represent the pinnacle of house prices in their countries, being among the most desirable areas.

Comparing House Prices in Other Large Cities

What about other large cities? Manchester and Chicago make for a useful comparison – both formerly industrial, in areas with more reasonable living costs (the north of England and the US Midwest). The average house price in Manchester is £284,658. In Chicago, it is $310,452. This is £30,000 less than the equivalent in Manchester.

Comparing House Prices in Rural Areas

Let’s consider house prices outside of the cities, in more remote areas. The South of the USA is far more rural and is known for cheaper living costs. For those of you who prefer country living to the hustle and bustle, you will find that a house in Mississippi – the cheapest state to live in the USA and the fourth most rural – will cost on average $173,634.

By comparison, many rural areas in the UK, like Surrey and Hampshire, are viewed as desirable and often come with higher house prices. One notable exception is Lincolnshire, which manages to maintain relatively cheap average house prices in a rural environment, at £241,092. This is still almost £100,000 more than the average price in Mississippi after conversion.

Winner: USA

There are still more specific ways to examine house prices, even down to individual neighbourhoods, but it seems that the USA can provide better value for money than many UK properties – at least outside of particularly in-demand urban centres like New York.

Cost of Utilities and Maintenance in the UK vs the USA

This is where you find the big difference in the cost of living in the UK vs the USA, especially in housing. Utility costs are generally much more expensive in the UK than in the USA. Electricity prices are higher in the UK – the price per kilowatt hour being 0.27 in the UK compared to 0.15 in the USA, at the time of writing. Many UK homes also require energy efficiency improvements, whereas the USA has a lot more modern builds.

The UK is forced to import gas too, which puts costs at the mercy of global energy prices. The USA, on the other hand, has the natural resources to extract a lot of its own gas and has greater energy self-sufficiency. It is an ambition of many politicians in the USA to reach total energy independence. Such a policy in the UK is likely impossible. So, don’t expect the difference in utility costs to change any time soon.

Winner: USA

If you are planning to move from the UK to the USA, you’ll be pleased to know that utilities costs in the USA are generally cheaper than in the UK. However, it’s important to note that utility costs can vary depending on the state or region you are in, and that the actual cost of utilities will also depend on your consumption. It’s a good idea to research specific utility providers and compare prices when making your move to the USA.

Transportation Costs: UK vs USA

Public Transport: Are UK or USA Fares More Reasonable?

When you compare living costs between the USA and UK, public transport is key, particularly because in the UK it is much more ubiquitous.

The issue of public transport seems like a win for the UK in terms of accessibility. There are a few cities in the USA that rank highly for public transport, like New York, Boston, San Francisco, Chicago, and Washington DC, but there are entire states where you will essentially need a car to live and work.

Public transport in the UK can be expensive – a monthly Zone 1 to Zone 3 London Tube travel card for an adult costs £174 compared to $127 for the equivalent in New York. However, it is accessible, with buses, in particular, providing a good cheap option for long-distance travel.

To contrast, it’s estimated that 45 per cent of Americans have no access to public transport at all, with less than 1 per cent frequently travelling by rail. The UK population is much more familiar with public transport. It’s believed that 31 per cent of the UK population lack access to a car and are thus reliant on public transport.

Winner: It Depends…

It’s difficult to say who the “winner” is when comparing public transport between the USA and UK, as it depends on personal circumstances and preferences. In terms of accessibility, the UK has a more widespread public transport system, particularly in cities, which may be beneficial for those who don’t have access to a car or who prefer to use public transport. On the other hand, while public transport is not as ubiquitous in the USA, some cities have very good public transport systems that can be cheaper and more efficient than owning a car. Ultimately, it’s important to consider the specific location and your individual transportation needs when deciding which country has the better public transport system.

This brings us to…

Owning a Car

It’s believed the average American family spends $819 a month on transportation. This is a much higher living cost compared to the UK. A lot of that is wrapped up in car ownership. Whether it’s the vehicle purchase, petrol, insurance, or maintenance, it all adds up. For many people in the USA, there’s no alternative to using a car for transport. Compared to the UK, trains, buses, or metro systems are much less accessible. When you own a car, you have to then consider…

Winner: It Depends…

While car ownership and usage is generally more expensive in the USA than in the UK, owning a car can also offer more flexibility and convenience in many parts of the USA where public transport is less accessible.

Is Petrol More Expensive in the UK or the US?

This is a serious financial commitment for people on both sides of the pond and a key consideration when analysing the cost of living in the USA due to your dependence on your car.

The price of petrol (remember to start calling it ‘gas’ after your big move!) is often much cheaper in the USA than the UK. Britain has the 6th most expensive fuel and drivers pay 77p more a litre than in the US. The major reason for this difference is the taxes. In the UK, 46% of the retail price for gasoline can be attributed to taxes alone. The reason fuel is so much cheaper in the States is because they pay less than one quarter of the tax that we Brits pay on our fuel. So, USA is a clear winner here, however, it may be worth considering how much larger the USA is as a country and how much more (or less) driving you plan to be doing when you move. These factors may tip the scales slightly in favour of the UK, depending on your specific circumstances.

Winner: USA

Fuel is generally much cheaper in the USA which can be a significant factor in the overall cost of living for those who rely on their car. However, it’s worth considering individual circumstances, such as the amount of driving that will be required, and the size and location of the country, as these factors can also impact the cost of fuel and transportation.

Grocery and Food Prices

Our next cost of living comparison brings us to food and groceries. Obviously, this won’t be as big an investment as a house or a car but will be a regular outgoing expense over time. It’s important for you to figure out the difference in this living cost between the UK and the US.

Food and Household Essentials: How Much to Spend in Each Country?

It’s estimated that a British household spends £280-£300 per month for two adults, rising to £370 for a family, while an American household will spend almost $700 on groceries, which is up to 2.5 times more than you might expect to pay in the UK..

What is the difference when shopping? UK supermarkets gain a lot of sales from own-brand products, which tend to offer cheaper but good-quality alternatives. Supermarket brand products accounted for more than 50 per cent of all supermarket sales in the UK in 2016, compared to just 14.5 per cent in the USA. So it’s safe to say that UK groceries are cheaper overall, although this may change with future shopping trends.

Winner: UK

When it comes to grocery and food prices, the UK is the winner in terms of overall affordability. The average British household spends less on groceries per month compared to the average American household, and UK supermarkets tend to offer more own-brand products, which are generally cheaper but still of good quality. While shopping trends may shift in the future, as of now, UK groceries are generally cheaper compared to the USA.

Dining Out: Which Country is More Expensive?

The USA has a great variety of options to save money when it comes to dining out, from buffet restaurants (usually ‘all you can eat’ offering good value) to free unlimited refills for non-alcoholic drinks in most fast-food establishments.

Portion sizes are generally larger in the US, meaning you get more for your money. You can expect a good meal at a more upscale restaurant to set you back around $60 to $70. On average, Americans spend $253 on food outside of the family home per month. The average a British person spends eating outside the home each week is £53, so roughly £212 per month, or $255.

Winner: USA

When it comes to dining out, the USA is the winner in terms of overall affordability. With a great variety of options to save money when dining out, such as buffet restaurants and free unlimited refills for non-alcoholic drinks in most fast-food establishments, eating out in the USA can be a more affordable option. In addition, portion sizes in the USA are generally larger, offering more value for money. On average, Americans spend less on food outside of the family home per month compared to the average amount spent by a British person, making dining out in the USA generally more affordable.


Let’s examine taxes in the USA vs the UK. The UK tax year starts on April 6 and continues until April 5 of the next year. In the US, the tax year is different, beginning on January 1 and lasting until December 31.

As with a lot of other factors affecting the cost of living, the size of the USA makes a crucial difference here. The USA has different rules by state and at the federal level, meaning that there are many variations for what you could pay depending on where you live.

With that understanding, let’s dive in.

Income Tax: How Do UK and USA Rates Compare?

There are significant differences already between taxes in the UK and the US. Income tax is worked out similarly, but has very different income brackets. In the US, your income tax is taken as a percentage of your income. In the most recent tax year, you could have anywhere between 10, 12, 22, 24, 32, 35 or 37 per cent of your income spent on income tax. It all depends on how much you earn and the highest rate only applies if you’re earning more than $539,900 as a single filer or head of a household.

In the UK, there are four income tax bands. There is ‘personal allowance’, where you don’t pay income tax up to a certain amount. Then there is ‘basic rate’, a 20 per cent rate of tax up to £50,270. After that, there is ‘higher rate’, a 40 per cent rate of tax up to £150,000, and then ‘additional rate’, which is 45 per cent for any income over £150,000.

So if you are a high-income earner, you will pay significantly less tax in the USA: However, let’s not forget the additional state tax. This isn’t a tax in many US states but can be surprisingly substantial where it does apply – for example, in New York, where state taxes can reach 8.8 per cent.

Overall in the UK, you will probably pay more tax, but there are other associated costs of living that are exceptional to the USA.

Winner: It Depends…

When it comes to income tax, the USA can be the winner for high-income earners, as they may pay less tax in the USA compared to the UK. However, it’s important to note that the tax system in the USA is more complex, with different income tax brackets that can vary depending on the individual’s income. In addition, some states in the USA may also have additional state taxes that can significantly impact the overall tax burden. In the UK, the income tax system is simpler, with four income tax bands and a personal allowance. While high-income earners may pay more tax in the UK, it’s important to consider other associated costs of living when making a move to either country. Ultimately, the winner may depend on personal circumstances and income levels.

Sales Tax: Which Country Has Lower Rates?

This is where the size and scale of the USA is tricky. Each state sets its own rules on sales tax (a tax on products and services), which means that it varies across the entire country from 2.9 per cent to 7.25 per cent. In the UK, sales tax, which you might know as VAT, is fixed at 20 per cent – so whichever state you choose, you’ll be paying significantly less tax on goods and services.

Winner: UK

When it comes to sales tax, the UK is the winner in terms of having a lower overall rate compared to the USA. This means that regardless of which state you choose to live in, you will likely pay less tax on goods and services in the UK compared to the USA.

Property Tax Rates

You will know property tax in the UK as council tax and stamp duty land tax. The stamp duty land tax is against residential properties with a value of more than £125,000 (and non-residential at more than £150,000).

And when it comes to council tax, it is set by local councils depending on house value, but the national average is between £1,114 and £3,343 annually depending on what band your home falls into.

Property tax in the USA can again vary a lot depending on which state you plan to relocate to. Taking the USA as a whole into account, the property tax rate is 1.1 per cent of the average home value. This will be something you need to explore further before your move, depending on where you want to live.

Some states have very high rates of property tax, for example, New Jersey, where a mid-sized property will cost more than $15,000 per year. Hawaii has the lowest rate of property tax at 0.31 per cent.

Winner: It Depends…

It is difficult to say who the clear winner is, as property tax rates can vary greatly depending on the specific state or region in the USA, as well as the value of the property. The national average property tax rate in the USA is 1.1% of the average home value, which can be higher or lower than the council tax rates in the UK, depending on the property value and location. However, some states in the USA may have much higher property tax rates, while others may have much lower rates. Therefore, it’s important to research property tax rates in the specific area you plan to live in and compare with council tax rates in the UK to determine the best option for your individual circumstances.

Other Expenses

There are many other expenses associated with relocating to a new country. Some of these might not apply to you or might not be as significant as house prices or taxes in the USA and the UK. However, they are still worth considering!

Healthcare Costs

The costs of private healthcare in the USA are often publicised. Health insurance is essential. Unlike in the UK, healthcare is not free at the point of care. However, many workplaces offer health insurance coverage as a benefit, even extending to your family as well. This can ease the financial burden.

You can expect to pay a monthly fee for healthcare insurance (known as a ‘premium’) – although this could be covered by your employer – and with most health plans expecting you to pay a certain amount of care until the insurance kicks in. This is known as a ‘deductible’ – the amount that you must personally pay. Fortunately, health insurance can usually cover 100 per cent of all preventative visits like annual check-ups and vaccinations.

It’s important to shop around and explore as many different plans as you can before committing to one. Ask people who have lived in the USA their whole lives for advice. They will be accustomed to identifying the best type of health insurance for them. Health insurance premiums can vary a lot depending on age, location, family size, and the type of plan you have. The average health insurance cost in the USA is $477 per month for a 40-year-old individual, reaching $6,000 per year.

In general, healthcare in the USA is 7.5 times more expensive than in the UK. US healthcare is actually more expensive than any other country in the world, with an average of 40 per cent more spent on patient care. This is a really important factor to consider when making a cost of living comparison between the USA and the UK.

Winner: UK

The UK is the winner in terms of having a more affordable healthcare system compared to the USA. Unlike in the UK, healthcare is not free at the point of care in the USA, and private healthcare costs can be very high. While many workplaces offer health insurance coverage as a benefit, this can still be a financial burden for individuals and families, and the cost can vary greatly depending on factors such as age, location, family size, and the type of plan. In general, healthcare in the USA is 7.5 times more expensive than in the UK, and the USA has the highest healthcare costs in the world, with an average of 40% more spent on patient care. Therefore, healthcare costs should be an important factor to consider when making a cost of living comparison between the USA and the UK.

Childcare Costs

In general, childcare costs more in the UK than in the US. The UK has some of the highest childcare costs of any country – over 23 per cent of the average monthly earnings of two adults, compared to 13 per cent of the average monthly earnings of two adults in the USA. As with many expenses that we’ve covered here, it might not seem like a big difference, but it all adds up!

Winner: USA

The USA is the winner in terms of having lower overall costs compared to the UK. The UK has some of the highest childcare costs of any country.

Entertainment Costs

In the UK, it’s estimated that consumers now spend £69.64 on average for a night out. This can go much higher in London, where the cost of living is higher than in the rest of the UK. To compare, the average US household spends $243 monthly on entertainment costs. In a single night out, the average person in the US spends $80. For this particular cost of living comparison, the UK and the USA aren’t that different.

Winner: It Depends…

While the costs are similar, they may vary depending on location and the specific activities chosen for entertainment, so it’s important to research and compare the costs of entertainment in the specific area you plan to live in.

So, Which Country Offers a Better Cost of Living? The UK or the USA?

Your financial outgoings in the USA will depend a lot on where you plan to make your big move. There are so many financial commitments that are dependent on a state or federal level – like US health insurance, taxes, public transportation, and house prices – that the cost of living in the USA could be very variable.

If the cost of your relocation seems intimidating, remember that there are always options and opportunities in such a big country. There are many states with a cheaper cost of living and amazing pull factors, like Kansas, Mississippi, Oklahoma, and Indiana. In the long run, you may well end up saving more money than if you’d continued residing in the UK.

Our advice would be to create a budget that takes all of the factors we’ve discussed into account and the cost of living comparisons between the USA and UK. Maybe some of them are more important to you than others. Obviously, families with children will have a different set of priorities than young single people, and with that comes different financial commitments.

One thing is for sure – you can start your move the right way with the best value moving company. 1st Move International offers faster international removals services to the USA with the UK’s premier shipping lines. Whether shipping to New York or any other destination in America, we can help.

We’ve been helping people move their treasured possessions overseas for 25 years, fully insured and professionally packed. You can get a quote or contact 1st Move International to find out more.

About 1st Move International

1st Move International are a specialist international moving and shipping company offering packing, shipping and insurance for shipping household goods and personal effects overseas. We have a global reach covering over 80 countries and 6500 worldwide destinations. You can get an international removals quote here or find more information on our international removals UK to USA service here.

Avatar for Mike Harvey
As the Managing Director of 1st Move International, Mike Harvey brings more than two decades of logistics expertise and three years of specialised experience in international relocations to his role. His comprehensive knowledge spans the intricacies of overseas shipping, secondary yet crucial areas such as visa application processes and immigration requirements, and the wider topic of moving abroad including topics such as comparative analyses of cost of living, healthcare and educational systems worldwide. This expertise allows 1st Move International to equip people with the information they need to not just move overseas, but to make informed decisions about whether, and where, to relocate.