- Inflation may have fallen, but the cost of living is still a major concern for people across the country, and the companies that look to employ them.
- CNBC considers Cost of Living among ten categories of competitiveness in the annual America’s Top States for Business rankings.
- In addition to the costs for basic goods and services, the CNBC study considers housing and insurance costs.
Inflation has fallen considerably, but it is still too high for Federal Reserve policymakers’ tastes. And tariffs make the calculation even more complicated.
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“We’ve had goods inflation just moving up a bit,” said Fed Chairman Jerome Powell at a
news conference
last month. “We do expect to see more of that over the course of the summer. It takes some time for tariffs to work their way through the chain of distribution to the end consumer.”
CNBC considers Cost of Living among ten categories of competitiveness in our annual
America’s Top States for Business rankings
. Companies seeking to attract as many workers as they can — and reduce their own wage costs — like to locate in places that are affordable. So, we rate the states based on an
index
of prices for a broad range of goods and services calculated by the Council for Community and Economic Research, C2ER. We also consider housing affordability. And, with an insurance crisis spreading across the country, we measure the cost to insure a median priced home based on the most recent available data. Under this year’s
methodology
, Cost of Living is worth 2.4% of each state’s total score.
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Some
states remain very expensive for residents.
Others are doing a fair job in the fight to keep costs down. Based on the 2025 Cost of Living category points totals — which results in some tie scores between states, though only one that can be called the nation’s “least expensive” — here are America’s cheapest states to live in, along with average prices in 2024 of some basic items in key metro areas.
Shocked at the price of eggs? Head to Kalamazoo, where you’ll pay around 20% less per dozen than they are paying in Newark, New Jersey (prices in this list were compiled last year, before
egg prices
began rising again, but the difference remains about the same). And the cost of a new home in
Michigan
is less than half what they are paying in New Jersey.
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2025 Cost of Living Score:
39 out of 60 points (Top States Grade: B–)
Consumer Price Index
(May, Midwest Region): +2.4%
Annual Homeowner’s Insurance:
$3,290
Average Home Price
(Kalamazoo): $298,697
Dozen Eggs
(2024): $2.99
Monthly Energy Bill:
$203.46
The Hawkeye State has home field advantage when it comes to corn, which will cost you about 16% less at the supermarket than they are paying in Washington, D.C. Speaking of home, housing prices in Iowa are among the most affordable in the nation. But one thing that is becoming less affordable is insurance. Online insurance marketplace Insurify
projects
that the average
Iowa
homeowner will pay $3,825 for insurance this year, a 19% jump from last year. Premiums have been rising since the 2020
derecho
, a massive wind storm that destroyed some 8,000 homes and did millions of dollars in damage. A parade of severe weather has followed, bringing higher premiums along with it.
2025 Cost of Living Score:
39 out of 60 points (Top States Grade: B–)
Consumer Price Index
(May, Midwest Region): +2.4%
Annual Homeowner’s Insurance:
$3,825
Average Home Price
(Burlington): $320,694
Dozen Eggs
(2024): $3.24
Monthly Energy Bill:
$215.83
Despite its coastal location, The First State has managed to dodge the insurance crisis, at least so far. Premiums in
Delaware
are about one-tenth of what they are in Florida. It helps that the state has managed to avoid natural disasters in recent years, and that the population is relatively sparse. Housing costs in general are reasonable for most homeowners and renters in Delaware. According to Census data, only about 26% of them are spending more than one-third of their household income on housing. In California, that number is more than 39%.
2025 Cost of Living Score:
39 out of 60 points (Top States Grade: B–)
Consumer Price Index
(May, South Region): +2%
Annual Homeowner’s Insurance:
$1,693
Average Home Price
(Dover): $370,378
Dozen Eggs
(2024): $3.20
Monthly Energy Bill:
$199.31
The Cowboy State has managed to rein in housing and insurance costs. Seventy-five percent of
Wyoming
homeowners and renters pay less than 30% of their household income on housing. Insurance premiums are projected to rise by about 7% this year, but that is less than the average increase nationwide of around 8.5%. Home prices are running about 17% less than in neighboring Montana.
2025 Cost of Living Score:
41 out of 60 points (Top States Grade: B)
Consumer Price Index
(May, West Region): +2.4%
Annual Homeowner’s Insurance:
$2,424
Average Home Price
(Laramie): $426,326
Dozen Eggs
(2024): $2.98
Monthly Energy Bill:
$172.82
The Buckeye State is also bucking some of the national trends on housing and insurance costs. At $268,600 statewide, according to Redfin, Ohio’s
median home sale price
is among the lowest in the country, and well below the national median of $441,738 in May. It will cost you roughly half what it would in Minnesota to insure a typical home. And everyday staples are more affordable in
Ohio
as well. A loaf of bread in Youngstown is about 15% cheaper than it is in Portland, Oregon.
2025 Cost of Living Score:
41 out of 60 points (Top States Grade: B)
Consumer Price Index
(May, Midwest Region): +2.4%
Annual Homeowner’s Insurance:
$2,006
Average Home Price
(Cleveland): $391,639
Dozen Eggs
(2024): $3.24
Monthly Energy Bill:
$161.82
Got a hankering for some Southern fried chicken? Here in The Heart of Dixie, a whole fryer will cost you a little more than half what you would pay in Oakland, California. A house in booming Huntsville will cost you about one-third what a similar home would cost in Lake Havasu City, Arizona. But this state’s Gulf Coast location means that homeowners insurance costs are starting to eat into household budgets. Premiums in
Alabama
are the sixth highest in the nation.
2025 Cost of Living Score:
43 out of 60 points (Top States Grade: B+)
Consumer Price Index
(May, South Region): +2%
Annual Homeowner’s Insurance:
$5,831
Average Home Price
(Huntsville): $361,221
Dozen Eggs
(2024): $3.35
Monthly Energy Bill:
$172.74
Housing costs are easily manageable in The Peace Garden State. Three out of five homeowners and renters are paying less than 30% of their household income on housing costs.
North Dakota
overall does well on housing affordability, but the market is tight in spots. Before leaving office this year and joining the Trump administration as Interior Secretary, Gov. Doug Burgum unveiled a comprehensive
housing strategy
, developed by a state Housing Initiative Advisory Committee, aimed at bringing the housing market into better balance. The plan includes reductions in red tape to spur development, financing assistance, local housing grants, and grants to local school districts to train the next generation of construction workers.
“If we want to continue to attract and retain workers and grow our economy, we need to reduce barriers to workforce participation such as housing,” Burgum said in November.
2025 Cost of Living Score:
45 out of 60 points (Top States Grade: B+)
Consumer Price Index
(May, Midwest Region): +2.4%
Annual Homeowner’s Insurance:
$3,931
Average Home Price
(Fargo): $390,066
Dozen Eggs
(2024): $3.12
Monthly Energy Bill:
$139.56
Show me a good time in Kansas City — say, a ticket to a movie — and I’ll show you a 25% savings over what it would cost you in Philadelphia. Life is easy on the wallet in The Show Me State. Go out for a burger after the movie in
Missouri
, and you’ll save another 25% versus what you would pay in Baltimore. But, as in other states in the region, you may find yourself spending a chunk of those savings on the rising cost of your homeowner’s insurance.
2025 Cost of Living Score:
45 out of 60 points (Top States Grade: B+)
Consumer Price Index
(May, Midwest Region): +2.4%
Annual Homeowner’s Insurance:
$3,641
Average Home Price
(Kansas City): $429,449
Dozen Eggs
(2024): $3.17
Monthly Energy Bill:
$219.67
Head across the Missouri River into
Kansas
, and you will find things even more affordable in the Sunflower State. A head of lettuce is 15% cheaper in Manhattan, Kansas, than in Manhattan, New York. A two-bedroom apartment in the Midwest Manhattan will set you back a little over $1,000 per month, while you’ll pay a little over $5,000 in that other Manhattan. But you will actually pay more per month for homeowners insurance in Kansas than you would in New York State.
2025 Cost of Living Score:
46 out of 60 points (Top States Grade: B+)
Consumer Price Index
(May, Midwest Region): +2.4%
Annual Homeowner’s Insurance:
$4,782
Average Home Price
(Manhattan): $399,444
Dozen Eggs
(2024): $3.04
Monthly Energy Bill:
$201.23
At $275,700 in May, the median home sales price in
Indiana
is about 35% below the national average. Yet home prices are appreciating nicely, by about 4% a year. Want to get your tires balanced as you drive through The Crossroads of America? Better to do it here than next door in Illinois, where it will cost 25% more.
2025 Cost of Living Score:
46 out of 60 points (Top States Grade: B+)
Consumer Price Index
(May, Midwest Region): +2.4%
Annual Homeowner’s Insurance:
$2,766
Average Home Price
(Indianapolis): $360,369
Dozen Eggs
(2024): $3.40
Monthly Energy Bill:
$169.58
Your money goes further in The Mountain State than in any other state. At the end of 2024,
West Virginia
‘s composite Cost of Living Index as measured by C2ER was 84.1, less than half the number for the most expensive state, Hawaii, at 186.9. Fewer than 20% of West Virginians are paying more than one-third of their monthly income for housing.
But even here, there are worries about a housing shortage, particularly for low-income residents. The National Low Income Housing Coalition
found
earlier this year that the state needs 25,000 more affordable housing units. The group says that for every 100 low-income households, only 58 rental homes are available. Part of the issue: an increasing number of units are short-term rentals, blocking full-time residents out of the market.
2025 Cost of Living Score:
58 out of 60 points (Top States Grade: A+)
Consumer Price Index
(May, South Region): +2%
Annual Homeowner’s Insurance:
$1,744
Average Home Price
(Charleston): $266,797
Dozen Eggs
(2024): $3.50
Monthly Energy Bill:
$198.12
Also on CNBC
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America’s Top States for Business 2025: See the full rankings
-
North Carolina is America’s Top State for Business in 2025
-
Massachusetts is America’s Most Improved State for Business in 2025
