San Diego’s reputation as a laid-back, beachside haven is well-earned—but that lifestyle now comes with a heavier financial burden. According to the latest Cost of Living Index released by the Council for Community and Economic Research, San Diego has jumped to the 9th most expensive city in the country, edging out Boston and putting even more pressure on local wallets.

While residents have long accepted the so-called “sunshine tax”—the unofficial price of perfect weather—2025’s data reveals just how costly everyday life in San Diego has become.

Everyday Essentials Are Driving the Surge

Unlike in previous years, it’s not just housing that’s pushing the cost of living higher. Although the average rent has actually dipped slightly (down 0.8% from last year to $3,127/month), costs for groceries, dining out, utilities, and retail goods are on the rise—and rising faster here than in many comparable cities.

According to the report, San Diegans are now paying more at the grocery store than residents in Los Angeles and Boston. Common items like orange juice, cheese, and ground beef are all significantly more expensive than they were just a year ago.

A Cooling Nation, but Not San Diego

While national inflation has started to ease, San Diego is bucking the trend. The city’s Consumer Price Index (CPI) climbed to its highest point in a year this past March—and has stayed there. This has made San Diego an outlier, where everyday expenses continue to rise, even as other major cities are seeing some financial relief.

San Diego in a Coastal Trend

All ten of the most expensive cities in the U.S. are located along the country’s coasts—or in the case of Honolulu, on an island. California in particular is home to four of them: San Jose, San Francisco, Los Angeles, and now, San Diego.

What makes San Diego’s situation unique is the combination of high housing prices and spiking day-to-day costs, which are squeezing residents from both ends. Even slight decreases in rent are being offset by increases in everything else, from gas to groceries to utilities.

Living the Dream—At a Premium

San Diego still offers what many consider an unbeatable lifestyle: ocean views, warm weather, vibrant neighborhoods, and a strong sense of community. But the cost of maintaining that lifestyle continues to rise, and for many, it’s no longer just a “sunshine tax”—it’s a major affordability challenge.

For anyone considering a move—or just trying to stay afloat—it’s clear that living in paradise now demands more than just a love of beach days. It takes careful planning, budgeting, and a growing awareness that the true cost of California dreaming is rising.