by - Inflation has significantly increased the cost of living for American households.
- Expensive housing, food and necessities are driving people to move to cheaper places.
- Private finance firm Kiplinger has listed the US cities with the lowest cost of living.
The cost of living in the US skyrocketed in 2022 as rising inflation drove up prices for everything from gasoline to groceries to home prices.
Higher costs have encouraged many Americans to reconsider the way they live — and most importantly, where they live. An October report by real estate agent Redfin suggests that higher mortgage rates and mounting economic woes are making expensive parts of the country “less attractive” to potential buyers.
“Mortgage rates of 6 percent are compounding already high home prices and motivating homebuyers — particularly long-distance workers — to leave expensive areas for more affordable ones,” said Taylor Marr, Redfin’s deputy chief economist, in the report. “Persistent inflation and collapsing inventories are also eating into buyers’ budgets, making relatively affordable areas even more attractive.”
While things may not get that expensive next year, even President Joe Biden said earlier this month that it will be “a while before inflation gets back to normal levels.” So the trend towards lower living costs is likely to continue into 2023 as respected economists and executives brace for a recession.
But where to go? Private finance firm Kiplinger identified America’s cheapest cities by calculating the cost of living — including housing, groceries, transportation, health care, and miscellaneous goods and services — of 267 urban areas in the United States with at least 50,000 residents.
According to their methodology, America’s cheapest city is Harlingen, Texas, a small town of fewer than 72,000 people on the southern tip of Texas near the Mexican border.
Harlingen — which sits in the Rio Grande Valley next to its twin city of Brownsville and a sandy beach-filled beach town called South Padre Island — is also known for its air force base and a launch facility for Elon Musk’s rocket company, SpaceX.
“The Rio Grande Valley is very affordable in general,” Craig Grove, a broker and owner of Brownsville brokerage firm GRT Realty, told Insider. “We’ve seen a lot of job growth in recent years because of SpaceX, and there’s a new medical school.”
Grove confirmed that the lower cost of living around Harlingen is attractive.
“People have said, ‘I don’t want to be in these big cities,'” he added. “It got too expensive, so they moved to the Valley, and that made Harlingen more attractive. It’s very old fashioned in a nice way – the people are very friendly, it still feels like a small town and the houses are affordable.”
The other affordable cities on Kiplinger’s list are mostly in the South and Midwest. Read on to see them all — and see if something could be right for you in 2023.
