The Cheapest Cities Americans Are Flocking To

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24/7 Wall St. Insights

• The Consumer Price Index has soared to historic highs in recent years.
• With the cost of living on the rise, many cities with lower consumer prices have reported an influx of new residents.
• Also : 2 Dividend Legends to Hold Forever

In the wake of the COVID-19 pandemic, the cost of living has soared in the United States. Over the 12 months ending in June 2022, consumer prices surged by a multi-decade high of 9.1%. Though the Consumer Price Index has fallen in the years since, at 2.9%, inflation remains above the Federal Reserve's 2% target rate -- and millions of Americans are feeling the pinch.

According to a recent survey conducted by the U.S. Census Bureau , 93% of American households reported elevated stress caused by rising prices, and over 57% of households had difficulty paying for usual expenses in the last week.

Notably, rising prices are not affecting all parts of the U.S. equally. In much of the country, goods and services are far less expensive than they are on average nationwide. In an era of historic inflation, when the cost of living is weighing heavily on the minds and pocketbooks of most Americans, people are flocking to major cities that are still relatively affordable.

Using data from the U.S. Census Bureau and the Bureau of Economic Analysis , 24/7 Wall St. identified the cheapest metro areas where the most Americans are moving to. We reviewed data on cost of living, housing affordability, and net-migration for 374 metropolitan areas. Only cities with a cost of living below the national average, and where the ratio of home values to median incomes are below the average across all metros, were considered. The metro areas on this list are ranked by population change due to net-migration between April 2020 and July 2023.

Among the 36 metro areas on this list, population change from migration alone ranges from a net-gain of 10,200 people to nearly 230,000. Across the country, the cost of living in a metropolitan area is higher than it is outside of metro areas. Still, in every city on this list, consumer prices are lower than they are across the U.S. as a whole. In several metro areas Americans are flocking to, the overall cost of living is over 10% below the national average.

In recent months, housing has been a primary driver of inflation -- but in the metro areas on this list, homes remain relatively affordable. Across all U.S. metro areas, the typical home is worth about 4.3 times more than the annual earnings of a typical household. In contrast, the median home value in most metro areas on this list is less than four times the local median household income. (Here is a look at the most affordable housing market in every state. )

The states with the lowest overall cost of living are disproportionately concentrated in the South and in the Midwest. In keeping with broader regional trends, 27 metro areas on this list are in the South and seven are in the Midwest. Meanwhile, none are located in Western states, and the only two Northeastern metro areas are in Pennsylvania. (Here is a look at the most expensive states to live in. )

Why It Matters

Every year in the United States, millions of Americans pack up and relocate to a new home. Reasons for moving vary from person to person, but in recent years, a significant share of movers have cited reasons related to the economy and housing. With consumer prices rising at historic rates, many cities with relatively affordable housing and a low overall cost of living have reported a rapid influx of new residents.

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