Alaska is the northernmost state in America and also the biggest. This state has many claims to fame ranging from its cold weather to its beautiful atmosphere. But the cost of living here is also notorious, with almost everything almost doubling the cost of what you’ll get in the other 48 states. So, is food more expensive in Alaska?
Yes, food is expensive. The cost of groceries in Alaska is 41% above the national average, and most food items are costly. This is due to the cost of transporting food to the state. Utilities, transportation, and healthcare also cost a lot in the state. But real estate is cheap, and taxes are low.
Regardless of the high cost of food and other things in Alaska, the state is wonderful. Whether you’re planning to visit or live there, there are a lot of great qualities that make it wonderful. Here, we discuss the cost of food and other basic expenses in Alaska.
Cost of Food in Alaska
The cost of groceries, food items, and restaurant meals in Alaska is quite high. This is because of the long distance from which the food has to be transported to Alaska. The state is one of the two non-contiguous states in the US, which means it’s not directly connected by land. To reach Alaska by land from the US, you’ll have to go through Canada. This distance and its remoteness have made the cost of transporting food to Alaska very high, and by extension, the cost of food is also high in the country. Grocery in Alaska costs 41.7% higher than the national average. The cost is generally high throughout the state, and not just in the major cities like Anchorage or Juneau. It’s even costlier in the more remote areas, as this means increased cost of production.
However, this doesn’t mean that Alaska doesn’t produce any food. The state has some fertile lands, especially in the south, where many farms have local produce. Coupled with fishing and hunting, that makes up for the state’s food production. That’s where its local delicacies, such as king crab, Kachemak Bay oysters, copper river red salmon, etc., come from. But the local food production isn’t enough to cater to its whole population.
What Else is Expensive in Alaska
It’s not only the cost of food that’s high in Alaska. Most of the other expenses incidental to living are also costlier here. These include:
Alaska is also one of the most expensive places for utilities. Whether it’s electricity, natural gas, water, and everything you need for your home will cost a lot more here. The average monthly cost of utilities here is 69.8% above the national average. So, you’ll be spending a lot more here on utilities than anywhere else in the US. The average cost of basic utilities monthly in Anchorage is $253.18 compared to the national average of $169.88. Surprisingly enough, Anchorage still has a cheap cost of utilities compared to some of the more remote areas in the state. The cost of the internet is also very high, with 60 Mbps or more of unlimited data costing an average of $124.
In Alaska, you need a car to get around. This very remote state doesn’t have any subway system, and only the major cities have bus options. In most towns, you won’t even find a bus which means you need a car. Owning a car, of course, is quite costly because they’ll have to ship the vehicle from a far distance. The cost of gas here isn’t low either. The average cost of gas here is the fifth-highest average in the country. But the cost of insurance in the state is lower than the national average. However, there are still several places in the city where you can’t go in a car. For example, Juneau, the capital of Alaska, isn’t completely accessible by car. So, you’ll need a ferry or plane to get there.
Americans pay one of the highest costs of healthcare in America. If that bothers you, you’ll find it even more interesting that Alaska has one of the most expensive healthcare. The Health Care Cost Institute, in a 2016 report, found that the healthcare prices in the Anchorage metropolitan area are above the national median by 82%. Healthcare for the whole of Alaska is at least higher than the national average by 13%. Alaskans pay way more than the average American for health insurance, and a short visit to the doctor here costs $146 on average. The high cost of healthcare here has placed a higher burden on most employers in the state as they have to contribute more to their employees’ health insurance. The result is that the cost of items here is much higher compared to other parts of America.
What is Cheap in Alaska
However, not everything is costly here. Some things are a bit cheaper here than in other parts of the country. This includes:
1. Real Estate
The real estate market in Alaska is cheaper than the national average and has been growing at a more subdued rate. The typical value of homes in the state is $314,885, and it has only seen a 4.5% rise in the past year. The rent in Anchorage is around $1,200 for a one-bedroom apartment in Anchorage. Generally, the cost of real estate in major cities like Anchorage and Juneau is higher than what you’ll get in other cities in the state. The cheap rent and cost of homes in the city are understandable given its distance and remoteness. Most of the people who live here are even homeowners.
Taxes in Alaska are also low. The state doesn’t have an income tax or a sales tax. But each city has its own sales taxes, some of which are as much as 7.5%. Property taxes have an average of 1.19%. Even though the state doesn’t have taxes, it’s still one of the richest states in the country due to its wealth of resources. Alaska has oil from which it generates its revenue. Apart from Alaska not collecting taxes, permanent residents also receive yearly dividends.
Food in Alaska is costly, and that’s mostly due to the cost of transportation. Most of the other basic expenses are also costly here. However, the cost of houses and rents are quite low. This is likely due to the remoteness, which has reduced the demand for houses in the state.