Full transparency

Methodology

Every number, formula, and assumption behind the true-cost estimate, in full. Last reviewed July 2026.

The core idea

The “true cost” of an address is the sum of four yearly components: housing, property tax, transportation, and the value of your commute time. Standard calculators show only the first. Adding the rest is what reveals when a cheaper-seeming suburb actually costs more than a walkable city neighborhood, or the other way around.

Key constants

Annual cost per car (AAA)$12,000
Default hourly rate$25
Working days per year250

1. Annual housing

Your monthly housing cost (rent or mortgage) × 12. You enter this for each address, so the comparison reflects what you would actually pay, not a generic average.

2. Property tax

We look up the effective property tax rate for your address's city and state from the API Ninjas property tax database, then compute:

annualPropertyTax = annualHousing × effectiveTaxRate

If a rate can't be found, we fall back to a 1.5% effective rate as a reasonable U.S. average.

3. Transportation (car cost)

The number of cars a household needs is estimated from the address's Transit Score (from Walk Score), using these tiers:

Transit Score ≥ 700Car-free viable
40 to 701One car usually enough
Below 402Car-dependent (typical suburb)
annualTransportation = carsNeeded × $12,000

Each car is valued at $12,000/year, the average annual cost of car ownership from AAA's “Your Driving Costs” study (fuel, maintenance, tires, insurance, license/registration/taxes, depreciation, and finance). You can override the car count for either address if your situation differs.

4. Commute time value

We get driving and transit commute times between your address and workplace from the Google Directions API, pick the faster mode for each address, and value that time at your hourly rate:

annualCommute = (commuteMinutes ÷ 60) × hourlyRate × 2 × 250

The × 2 accounts for a round trip. At the default $25/hr, a 60-minute one-way commute works out to $12,500/year: time you can't get back, priced as if it were money.

Putting it together

totalTrueCost = annualHousing + annualPropertyTax
              + annualTransportation + annualCommute

The calculator shows both addresses side-by-side and highlights which saves you more per year. See it in action on the calculator.

Worked example

Say Address A is a $1,500/mo apartment with a Transit Score of 80 and a 30-min commute, and Address B is a $1,800/mo suburban house with a Transit Score of 25 and a 60-min commute, both at the default $25/hr rate:

Per yearAddress AAddress B
Housing$18,000$21,600
Transportation (0 vs. 2 cars)$0$24,000
Commute time (30 vs. 60 min)$6,250$12,500
Property tax (1.5%)$270$324
Total true cost$24,520$58,424

Even though the suburb's rent is only $300/mo higher, the extra cars and longer commute make the gap far larger. That's exactly the insight TrueAddressCost is built to surface.

Limitations & caveats

  • AAA's figure is a national average; your real car cost depends on vehicle, mileage, insurance, and more.
  • Property tax rates are city-level averages, not your specific assessment.
  • Commute times reflect typical conditions, not real-time traffic.
  • Utilities, groceries, income taxes, and childcare are intentionally out of scope.

Full legal details are on our disclaimer page.