The 5 Cheapest Cities to Live in America Right Now
Finding affordable places to live has become a top priority, and it's one that individuals and families alike have focused on during the last few years. During the COVID-19 pandemic, there was a large increase of Americans moving to different cities and states to live a cheaper and better lifestyle. Yet when the pandemic ended, the moving did not.
In fact, the United States Census Bureau found that more Americans migrated between states in 2021 than they did during 2019. The key was moving to less populated states, getting away from those bigger cities and higher costs. And it hasn't stopped, with Florida become the fastest growing state in 2022, for the first time since 1957.
As Americans continue then to seek out cheaper living options, it's important to understand the factors that can contribute to a city's affordability. So today, let's look at those considerations before you start packing your bags.
What makes a city cheap
There are a number of factors to consider when identifying what makes a city cheap. It takes a combination of all these factors to identify the cheapest cities in the United States. Yet the most expensive factor, is of course housing.
Unfortunately, the housing market hasn't experienced a significant cost reduction, despite overall inflation declining. While inflation came down to 3% year-over-year in June this year, the Bureau of Labor Statistics found that costs of shelter remained elevated, up 7.8% year-over-year. Therefore, those people lucky enough to find inexpensive housing options in the current environment can lessen their overall cost of living dramatically.
Another cost to consider is utilities and services. These are the next major costs that can make a city affordable or unaffordable. Such expenses include electricity, water, transportation, healthcare, and groceries that will all impact your daily spending.
Here Americans can look at the Cost of Living Index (COLI), which compares the cost of living in cities across the country. The lower the COLI score, the more affordable it is. Ideally, you want a city that will fall far lower than 100, which would be the average COLI score for the United States.
Finally, a cheap city is great, but only if you have a job. Therefore, identifying cities with a strong job market and stable economy are another area to consider when finding the cheapest cities.
The 5 cheapest cities right now
Drum roll please! The five cities that make up the cheapest options available right now are mainly located in the South and Midwest. Furthermore, they offer good schools and a thriving labor market.
5. Fort Wayne, Indiana
First up we have Fort Wayne, Indiana. The city holds a COLI at 85.2%, with the median home value at $121,600 and rent of $675. Its unemployment rate sits at 3.8% as well, with a robust job market for Americans to consider. The “Summit City” continues to have a robust economy, as well as an exceptional quality of life. The city offers job opportunities specifically in healthcare, manufacturing, education, and defense, with major employers such as General Motors (GM). However, its crime rate is higher than the national average, and if you're looking to escape to warmer weather, this city can be quite cold and snowy.
4. Huntington, West Virginia & Ashland, Kentucky
The fourth spot is a tie actually, between Huntington, West Virginia and Ashland, Kentucky. The pair both have a COLI of 85.1%, median home value at $130,000, and median rent of $675. The unemployment rate is also the same at 5.1%.
The “River City” of Huntington is perfect for those seeking the outdoor natural beauty in their city. Nearby state parks, hunting and boating are all reasons many residents have chosen to settle down. Ashland is also a great option, as it sits near the banks of the Ohio River, with plenty of natural life around as well. However, if you're looking for a more central location, it might be the one to consider. You gain access to the Tri-State area of Kentucky, Ohio and West Virginia, offering easy travel to larger cities for work.
That being said, both of these cities have their challenges. Both experienced set backs from the declining coal industry, and have a crime rate above the national average.
3. Youngstown, Ohio
In third place we have Youngstown, Ohio, with a COLI of 84.1%, median home value at $125,000, median rent at $650, and a 5.4% unemployment rate. The city has many job opportunities as well, with employers again such as General Motors, but also from local energy producers and healthcare providers. However, the decline of the steel industry to a hit on the city and it's still trying to recover. Further, the crime rate is higher than the national average. Yet overall, it's an affordable place to live with many opportunities to grow.
2. Hickory, North Carolina
Then we have Hickory, North Carolina, boasting an 83.4% COLI, median home value of $155,000, rent of $750, and a 3.6% unemployment rate. As with the other cities, there are again plenty of job opportunities as well, in particular in the furniture, healthcare, and technology industries. The city also has the Catawba River running through it, as well as the nearby Blue Ridge Mountains. Yet as with the others in this article, crime rate is higher than average.
1. Brownsville, Texas
- Finally, Brownsville, Texas is the last of the cheapest cities to live in, doing the best overall. Its COLI hit 82.4%, with the median home value at $138,900, rent of $700, and unemployment at 5.5%. If you're looking for a destination filled with adventure in the Southwest, Brownsville is surrounded by natural beauty, and quite near the Gulf of Mexico and Rio Grande. Again, crime is higher than the national average, and the decline in manufacturing in the area has hit the city. Overall, however, it's the best and cheapest option for those looking for a new place to live.
On the date of publication, Amy Legate-Wolfe did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.