New York is the best city in the world. I lived in Chicago, Providence, LA, Boston and Ann Arbor, and I know that's not everywhere, but I feel like I've had my taste of other places.
BUT it's the worst place to start a band. Plenty of people like good music and there's a nice little scene here, but it's tough to pay for everything (especially rehearsal space.) House shows are kinda pointless here, as well. All the good touring bands do come through here, though, and there are plenty of good local bands.
I'd save a good deal of dough before moving here. The job market is getting better, as long as you find a decent job, you can live here pretty easily. If you have a trade skill that's practical (painting, etc.) there are lotsa opportunities and you could make a killing. Become good friends with a bartender.
A lot of people move here for no reason. Big mistake. If you do move here, make it worthwhile and do all the things that the city has to offer. Parks, museums, movies, etc. I don't get the people who move here into a shitty apartment and hang out in there one little area of Brooklyn. They might as well live in mid-Jersey for half the price.
There are still good deals in South Williamsburg and Greepoint for apts. They've been building a lot so the older apt.'s are going down or at least levelling in price. Another thing to think about is Jersey City. The PATH might be extending their hours later into the evening and Jersey City has some decent bars and shops opening. Jersey City is as clse to NYC as Williamsburg, it's just zipcode snobs won't move there cuz they don't wanna tell their friends back home they live in Jersey, so they move to Astoria instead, look at a fuckin' map. I lived in JC for 3 years and it was fine.