Is it Cheaper to Live on the Top or Bottom Floor of an Apartment Building?

For the past two and a half years, I’ve lived on the upper level of my two-floor condominium apartment building.

On a non-financial basis, it’s worked out very well for us so far.

  • Being on the 2nd floor, we have a little more privacy on our balcony as well as from people walking by on the sidewalk outside not being able to see inside our living room.
  • In addition, I feel like it’s a little more secure since it would be harder to break in to our windows being elevated off of the ground floor.
  • The only half-way negative thing I can think about for living on the second floor has been that it is a little harder to carry in large objects and lots of groceries after big shopping trips.

However, the other day, I got to wondering whether or not living on the bottom level of our two-floor building would actually be less expensive from a financial standpoint than where we live now on the top floor.  The purpose of this post will be to investigate an answer to this question. Let’s get started!

After thinking about this question for a few minutes, I hypothesized that there would be three primary factors that would influence the cost being different for living on different stories of an apartment building: market value of the dwelling (can be rolled up in terms of measurables as monthly rent or condo purchase price), air conditioning, and heating.

Rent/Condominium Purchase Prices and Moving Costs

In my personal experiences renting apartments over the past 4 years and also purchasing my current condominium, I’ve found that apartments on the ground level tend to be more desirable and higher-priced (especially in places with narrow stairways and a lack of an elevator). When I lived in a suburb of Philadelphia, the top floor apartment I had was about $50 per month less than the same unit below me. In addition, in my condo complex, units on the ground floor tend to sell much faster and are also more expensive in terms of listing price.

Of course, all of these experiences were in quiet suburbs or smaller cities, not in the middle of a 20 million person metropolis where street noise might make lower level apartments much cheaper and less desirable.

In trying to find some answers outside of my personal experiences as to how real estate prices and moving costs compare for different stories of the apartment building, I came across the following details:

  • While I don’t remember encountering this during my moves to second-level apartments, I came across an article from Yahoo about someone saying that they had to pay the moving company a premium in order to move to an upper level unit because of the increased time and effort it would take.
  • A Telegraph article from the UK reported that flat values can decrease by up to a whole 1/3 as you move from ground floor units to 4th floor units

From these findings, it seems to be that it is cheaper to live on the upper floor than the bottom floor as far as real estate prices and rent are concerned. 

Air Conditioning During the Summer Months

The next point of comparison I wanted to investigate between top and bottom floors of an apartment building is the price of cooling the place during the hot summer months. Since most air conditioners these days run on electricity, we’ll measure this price in terms of electricity usage/cost. 

Since 2008, I lived in a bottom floor apartment for 1.5 years, and then two top floor apartments for the remaining time. Although I don’t have exact numbers of my electricity bills prior to July 2010 when I moved in to a 2nd floor apartment, I remember that the electricity costs (for A/C cooling) were a lot lower for a ground floor apartment. Of course, this makes sense from a physical perspective, since density decreases as the average kinetic energy (temperature) of the air molecules increases, causing the hot air to rise to the upper floors in the summer.

In looking around the Internet to try to quantify this price difference, I was surprised to only find one report of actual numbers comparing electricity costs for A/C usage among comparable apartments on different floor levels. This report stated that the person paid an average of $84 per month when living on lower floors vs. $120 per month on the top floor. This represents an annual cost difference of $432.

Because of this evidence and other reports on general guidelines for cooling apartments, it seems that it is cheaper to keep a lower floor apartment air conditioned in the summer months than an upper floor unit. 

In addition, I did find several useful statistics about average cooling and heating costs per year that one should plan for (we’ll use these in a little bit after we cover the heating topic):

  • A Zillow report stated that people generally spend about $300 per year on air conditioning, mostly running their A/C from May-September.
  • A DailyGreen article stated that the average US household spends $375 per year to keep their air conditioning running.


Heating During the Winter Months

As temperatures decrease further and further during the cold winter months, heating bills can become a very large financial liability for individual households. For this analysis, we’ll consider natural gas heating.

For me personally, I have always had natural gas powered forced air heating systems. In my current place, the heating (gas) bill is included in the monthly $214 HOA fee. Of this total amount, $100 is actual HOA fees, and the other $114 pays for sewer, water, trash pickup, and gas/heating. The same HOA and utility fee is paid by all units in our condo complex year-round, irregardless of what level the unit is on. Electricity (includes air conditioning/cooling) is paid separately directly to the power company.

From what I’ve found online, the generally accepted principle is that it is cheaper to heat an upper level apartment during the winter since, theoretically, the hot air from the apartment on the lower floor will rise up in to yours. This of course assumes that the insulation on the roof of your apartment is high quality and won’t leak too much heat.

If we apply this principle to my specific circumstance, we’re actually getting a bad deal with this since our upper floor apartment is more expensive to cool during the summer and the same price to heat during the winter! But, what can ya do right?!

A December 2011 Scientific American article reported that the average US household spends $732 per year to heat their home. 

Conclusion – Is it Cheaper to Live on the Top or Bottom Floor?

From what we’ve seen in this investigation, the upper floor is cheaper in terms of rent/sales price and heating during the winter. We’ve also seen that it is cheaper to cool a lower level apartment during the summer.

So, which is cheaper?

Overall, I was nicely satisfied with the evidence for the difference in rents and real estate prices for apartments on different levels of a building. However, the heating and cooling cost differences were only based on generally-accepted guidelines, gut feelings, and personal experiences, not robust data-based studies. In addition, the evidence presented so far doesn’t answer the question of HOW MUCH you can save for heating and cooling by having a unit on a different level. But, when I sit down and think about it, I imagine that this is because these cost differences depend on so many factors (building construction, insulation, etc) that the data would either be 1) extremely hard to obtain or 2) not all that useful on a more global scale.

However, from the average US household heating and cooling cost data (includes all homes – not just apartments) presented in this post, one interesting conclusion might be provided. For example, we saw from the data that on average, it costs approximately two times as much to heat a house than it does to cool a house over the course of a year ($732 vs. $300-$375, respectively). 

To me, this somewhat tells us that on average, it might be better to avoid increased heating costs. And, if we have to pay more for air conditioning in order to get lower heating/gas bills, then this combined with lower rent/purchase prices makes the upper floor apartment the overall cheaper alternative.   

Of course, another thing I’ve learned from this investigation is that these cost differences probably aren’t as significant as finding a level of the apartment building on which you are most happy with the noise, walking up stairs, views, and other factors.

How about you all? Do you think it’s cheaper to live on the top or bottom floor of multi-unit/family apartment building? What factor would you expect to be most significant in the possible price differential? 

Share your experiences by commenting below!

About the Author Jacob A Irwin

Hi folks! My name is Jacob. I am the owner and operator of My Personal Finance Journey. I started this blog in January of 2010 and have enjoyed the journey ever since. Since finishing up graduate school in Virginia in 2014, I have been working in biopharmaceutical development in Colorado. You can read more about me and this site here​. Please contact me if you have any questions!

follow me on:

Leave a Comment:

1 comment
Lance@MoneyLife&More says October 19, 2012

In college our apartment complex charged more for higher floors. This makes sense in college because parties tend to gather outside and go through the first floor a lot while the second and third floors only had traffic from the residents and their friends.

We lived in the 2nd floor of a 3 story building and it was the best of both worlds. Warm in the winter without using the heater often and colder in the summer from the apartment above us. Worked out well although I don't know if it saved any energy. It was worth paying a little more to live on the second floor in college to me though.
My recent post What Would You Do?: Kid’s Fundraisers & Charity Donations at the Office

Add Your Reply

Subscribe To Our Newsletter!

Join 1000+ Subscribers, Start Your Own Personal Finance Journey, & Get Exclusive Content.