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All Contents © 2018The Kiplinger Washington Editors
By Dan Burrows, Contributing Writer | March 19, 2018
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When it comes to cheap living, don't mess with Texas. The Lone Star State is home to four of the most affordable cities in America. But Texas doesn't have a monopoly on low living costs. Four other states make an appearance on our list.
If you're thinking about relocating to one of these cheap cities, weigh the pros and cons. A low cost of living is attractive, but the allure lessens if jobs are hard to come by, paychecks are small or the town offers little to do. Plan an extended visit to ensure the city fits your needs.
We compiled our rankings based on the Council for Community and Economic Research's calculations of living expenses in 269 urban areas. Its Cost of Living Index measures prices for housing, groceries, utilities, transportation, health care, and miscellaneous goods and services. (As for the miscellaneous category, think of expenses such as going to a movie or getting your hair done at a salon.) We did not include cities with populations below 50,000.
Take a look at our 2018 list of the 10 cheapest places to live in America.
The Cost of Living Index is based on price data collected during 2017. City-level data on populations, household incomes and home values come from the U.S. Census Bureau. Unless otherwise indicated, metropolitan-area unemployment rates come from the U.S. Bureau of Labor Statistics and represent January 2018 rates (not seasonally adjusted).
Cost of Living: 14.9% below U.S. average
City Population: 183,823
Median Household Income: $34,255 (U.S.: $55,322)
Median Home Value: $83,800 (U.S.: $184,700)
Unemployment Rate: 6.8% (U.S.: 4.5%)
The low prices in Brownsville come at a high cost. One-third of the residents of this Texas city on the Rio Grande river across from Matamoros, Mexico, live in poverty. That's more than double the 15.6% poverty rate for Texas as a whole, and nearly triple the U.S. poverty rate of 12.7%. Median income is more than $20,000 lower than the U.S. average, while median home prices are over $100,000 below the national average. It should come as little surprise that the city suffers from high unemployment, underemployment and low wages. Brownsville does have its charms. Prices for everything from groceries to housing to health care run well below national averages. The beaches and state parks of the Gulf of Mexico are a short drive away.
Cost of Living: 15.1% below U.S. average
City Population: 638,367
Median Household Income: $50,070
Median Home Value: $142,700
Unemployment Rate: 3.9%
The largest city in Oklahoma offers remarkably affordable prices for its size. The biggest reason: Housing costs run 27.4% below the national average, according to the Cost of Living Index, which takes into account both home prices and apartment rents. And, yet, as a metro area with 1.4 million people, Oklahoma City offers a lot of big-city attractions, from a philharmonic orchestra to the National Softball Hall of Fame and Museum. At the professional sports level, the Oklahoma City Thunder remains one of the most competitive teams in the NBA.
Wikimedia Commons, Chris Litherland
Cost of Living: 15.5% below U.S. average
City Population: 74,889
Median Household Income: $42,732
Median Home Value: $141,900
Unemployment Rate: 3.8%
Best known as the home of Arkansas State University, Jonesboro is a college town with a degree in affordability. Putting a roof over your head costs 25.8% less than the national average, according to the Cost of Living Index. Health care is very reasonable, too. You'll save about 20%, on average, on a visit to the doctor and 25% on a visit to the dentist. A trip to the optometrist costs 30% less than the national average. And when you feel the need to escape to a big city, Memphis is just an hour's drive from Jonesboro (more on the budget-friendly charms of Memphis later). Jonesboro's unemployment rate is among the lowest of the cities on this list.
Cost of Living: 16.7% below U.S. average
City Population: 652,717
Median Household Income: $36,975
Median Home Value: $93,700
Unemployment Rate: 4.2%
To say that real estate is cheap in Memphis is an understatement. You can buy a home for less than $100,000, an amount that barely qualifies as a down-payment in many of the most expensive U.S. cities you could live in. Renters benefit, too. A typical apartment in Memphis rents for about one-third less than the national average. There's also good work if you can get it. Proximity to the mighty Mississippi River makes Memphis a hub for the shipping and transportation industries. Three Fortune 500 companies—FedEx, International Paper and AutoZone—call the city home. You'll also find numerous colleges and universities, an NBA franchise, mouthwatering ribs, and, of course, Graceland.
Cost of Living: 17.8% below U.S. average
City Population: 186,239
Median Household Income: $34,556
Median Home Value: $120,300
Unemployment Rate: 3.5%
Thrifty types should volunteer to check out Knoxville, one of two Tennessee cities to make the list for inexpensive living. The city is notable for its across-the-board affordability for everything from food to transportation, according to the Cost of Living Index. Consider Knoxville, the original state capital before Nashville, a good mix of city and country living. It is home to the University of Tennessee and the Women's Basketball Hall of Fame, but Knoxville is also the gateway to the Great Smoky Mountains. The Tennessee River runs through downtown. The city was a strategic objective in the Civil War, so history buffs can visit a number of battlefields nearby.
Cost of Living: 18.3% below U.S. average
City Population: 104,724
Median Household Income: $43,997
Median Home Value: $94,300
Unemployment Rate: 3.6%
The largest employer in Wichita Falls is the United States Air Force, with Sheppard Air Force Base located just a short drive from downtown. But this city situated 140 miles northwest of Dallas claims other distinctions, as well. Wichita Falls is home to the Professional Wrestling Hall of Fame & Museum (admission in just $3), boasts the "world's littlest skyscraper" and allows servicemen and civilians, alike, to really stretch their paychecks. Housing costs, for example, run 30% below the national average. In another measure of home affordability, the gap between median home value and median income is a mere $50,000 and change, the narrowest margin on this list. A dollar goes farther on a trip to the grocery store, too. A dozen eggs are about 40% cheaper than the national average, while shoppers save nearly 20% on a can of tuna. Just be forewarned that this North Texas city gets H-O-T in summer, with average highs of 97 degrees in July.
Cost of Living: 20.5% below U.S. average
City Population: 75,984
Median Household Income: $34,767
Median Home Value: $96,600
Unemployment Rate: 5.0%
It's cheap to live in Kalamazoo—and that's a necessity for many residents. Almost one-third of the population lives below the poverty line, according to the U.S. Census Bureau, and low wages and underemployment are problems even for those who don't. The city has one of the lowest median household incomes on this list. Western Michigan University, with its multiple campuses and research facilities, is a major driver of the local economy. Pfizer, the drug company, has a sizable operation in Kalamazoo, and medical equipment maker Stryker is headquartered in the city. As for recreational activities, the Kalamazoo Nature Center hosts free daily activities. Nearby parks offer a combined 140 miles of trails and three swimming beaches. If you want to get away to the big city, Chicago is about three hours by car.
Cost of Living: 21.4% below U.S. average
City Population: 65,539
Median Household Income: $35,718
Median Home Value: $81,900
Unemployment Rate: 6.8%
South Texas border towns are known for low costs of living, but not always for happy reasons. In Harlingen, 31.3% of residents live below the poverty line. For Texas as a whole, the poverty rate is 15.6%; for the U.S. as a whole, it's 12.7%. However, just about everything, from groceries to gasoline, costs less in Harlingen. A good cut of steak goes for 21.2% less than the national average (this is Texas, after all). The median home value in Harlingen is a striking $102,800 less than the U.S. median. In addition to its proximity to Mexico, Harlingen is about an hour's drive to the beaches of South Padre Island.
Wikimedia Commons, Ronny Willhite
Cost of Living: 21.8% below U.S. average
City Population: 65,300
Median Household Income: $47,190
Median Home Value: $161,400
Conway is home to a number of high-tech companies, such as digital marketing firm Acxiom, and post-secondary educational institutions, including the University of Central Arkansas. Close proximity to the Arkansas River and Lake Conway make the city ideal for fishing and water sports, and there's ample space for hunting. Yet you can drive to the state capital of Little Rock in a half-hour or so. While Conway's median home value is the highest among the cities on this list, the figure is still below the U.S. median, and housing-related expenses, including utilities, are modest. Relatively low costs for health care also contribute to Conway's affordability.
Cost of Living: 23.9% below U.S. average
City Population: 142,212
Median Household Income: $45,568
Median Home Value: $117,500
Unemployment Rate: 7.6%
McAllen is about 30 miles west of Harlingen on the Rio Grande. It's a larger and relatively more prosperous city—household incomes are a full $10,000 higher than in Harlingen—yet McAllen's superlow living costs come at a price. The poverty rate is 25.7%, and obesity runs rampant. WalletHub.com named McAllen the third-fattest city in America (Little Rock, Ark., is number 1). The Mexican city of Reynosa, directly across the border, has been the scene of violence between drug gangs and Mexican security forces. On the plus side, McAllen is famous for bird watching because of its location on a major migration route. The Quinta Mazatlan, a luxury birdhouse with more than 15 acres of birding habitat, is not to be missed.
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