Americans are feeling the financial pinch on all sides: Whether it’s the high cost of housing, home insurance, utilities, gasoline, or even groceries, it seems there is nowhere to hide from skyrocketing prices.
Or is there? Research shows that the cost of living varies widely from state to state, and even city to city. So, what are the cities where you can have your paycheck stretched the furthest?
To find which cities have the highest and lowest cost of living, the economic research team at Realtor.com® examined the latest regional price parities (RPPs) data by the Bureau of Economic Analysis.
Topping the list is McAllen, TX.
With an RPP of 86.92%, what would cost you $100 nationally would cost only $86.92 in McAllen. Put another way, the cost of living there is 13% lower than the average.
“The metros with the lowest cost of living are largely concentrated in the South and the Midwest,” says Realtor.com senior economic research analyst Hannah Jones. “These areas tend to be smaller, with only Birmingham, AL, representing the 50 largest U.S. metros, as the 50th largest.”
And it isn’t just that you can bring home a larger bag of groceries in these areas than elsewhere. You can put down roots in these cities less expensively, too.
“Home prices in these areas were $100,000 or more below the national median in September,” says Jones.
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John Macke, senior research analyst at John Burns Research and Consulting, says that affordable housing plays a large part in the cost of living data.
“Looking at the BEA’s regional price parity data specifically, it’s the housing component that is much lower in these metros relative to others, making it the primary factor driving the lower cost of living,” says Macke.
So if you’re thinking about relocating to an area where you’ll get more bang for your buck, read on.
McAllen, TX
Low housing costs are the primary driver behind McAllen’s desirable low cost of living.
“Nationally, the home price-to-income ratio is around 5.5 as of August 2024, meaning home prices are 5.5 times the median household income,” says Macke. “In a city like McAllen, TX (4.8), home prices are much lower relative to incomes, driving down the overall cost of living.”
“McAllen’s location close to the Mexico border has fueled a trade-based economy and manufacturing jobs,” says real estate agent Cara Ameer. “There is no income tax in Texas, and property taxes are lower in McAllen. There is plenty of land on which to develop, which helps keep prices more affordable. In addition, McAllen has a lower cost of living, so that coupled with job opportunities helps create a more affordable environment.”
What residents pay for $100 of necessities: $86.92
Median home price: $275,000
Wichita, KS
The birthplace of Pizza Hut, White Castle, and Koch Industries, Wichita is no stranger to entrepreneurship, and with its low cost of living, it could be the perfect place to start your business.
What residents pay for $100 of necessities: $89.16
Median home price: $292,700
Little Rock, AR
Perhaps best known as where Bill and Hillary Clinton rose to early prominence in politics, Little Rock is no longer considered a place for just the rural types.
“Arkansas has become quite popular with Californians, who can take advantage of affordability, a milder climate, and an abundance of recreational opportunities such as Lake of the Ozarks,” says Ameer.
What residents pay for $100 of necessities: $89.15
Median home price: $291,000
Toledo, OH
Toledo, known as the “Glass Capital of the World,” recently ranked second in the Realtor.com list of the Most Affordable U.S. Metros.
“Transportation [in Toledo] is easy and inexpensive. Mass transportation is cheap,” says Jessica Lauren, a real estate investor in Columbus, OH. “The elderly and school-age population receive discounted rates for public transport. Gas is cheap. Ohio doesn’t add specialized taxes to gasoline.”
What residents pay for $100 of necessities: $90.18
Median home price: $237,450
Scranton, PA
Being the branch location of the fictional Dunder Mifflin Paper Co. on the popular TV series “The Office” didn’t do Scranton any favors. But its affordable cost of living does.
“The property taxes, along with costs of real estate, are much lower here than in the suburbs of Philadelphia,” adds Denise Supplee, founder of Spark Rental in Doylestown, PA. “The job outlook currently is not great but getting better.”
What residents pay for $100 of necessities: $91.90
Median home price: $243,450
Dayton, OH
Mike Wall of eXp Realty/EZ Sell Homebuyers, who has sold and invested in Dayton real estate for 23 years, says that the low cost of living here is due to five factors: an affordable housing market, a modest population growth, a diverse job market that isn’t tech-heavy, lower transportation and health costs, and less urban density.
“While Dayton has a diversified economy with industries like aerospace, health care, and manufacturing, the city doesn’t experience the rapid job market booms and busts that drive high living costs in other areas,” he says. “Wages are competitive, but the absence of industries like tech, which have skyrocketed living costs in places like Silicon Valley, helps Dayton maintain affordability.”
What residents pay for $100 of necessities: $91.39
Median home price: $250,000
Tulsa, OK
The cultural capital of Oklahoma, Tulsa has two museums, two opera companies, and two ballet companies. It also has one of the country’s largest concentrations of art deco buildings, and it even produced an “American Idol” winner: David Cook.
But all that culture will run you a lot less than living in New York City.
What residents pay for $100 of necessities: $90.53
Median home price: $325,000
Akron, OH
Real estate investor Lauren says of property in Akron: “There isn’t the amount of high-end housing or quality development in [Akron] compared to what you’ll find in other geographic regions,” which keeps housing prices low.
Also, Akron has a 15-year residential property tax abatement program, which exempts 100% of the added property value on any newly built home or renovation (valued at $5,000-plus).
Food prices are also kept reasonable thanks to Akron’s large farming communities.
![Real estate investor Lauren says of property in Akron: “There isn’t the amount of high-end housing or quality development in [Akron] compared to what you’ll find in other geographic regions,” which keeps housing prices low.](https://nypost.com/wp-content/uploads/sites/2/2024/10/top-10-cities-lowest-cost-92227709.jpg)
“The largest chain grocery in Akron sources vegetables directly from local farmers, and the prices are considerably less than prices in other states, even in farm-rich Indiana,” says Lauren. “There are also many farm stands in rural areas adjacent to these three cities. Milk, for example, is dirt-cheap compared to California prices.”
It also has the lowest median home price on this list, keeping its cost of living quite attractive.
What residents pay for $100 of necessities: $92.05
Median home price: $230,000
Birmingham, AL
Birmingham might have a low cost of living, but it has high-quality health care: The city is home to the University of Alabama at Birmingham and has a well-known medical center as well as a medical school.
What residents pay for $100 of necessities: $91.15
Median home price: $300,000
El Paso, TX
Californians rushed to Texas during the great COVID-19 pandemic migration, but El Paso escaped the resultant uptick in prices: It still has a low cost of living, and housing costs are reasonable.
But folks had better hurry.
El Paso is No. 3 on the list of places that could soon lose affordability thanks to mortgage rate drops.
What residents pay for $100 of necessities: $91.21
Median home price: $298,125