McAllen, Texas tops the list of most affordable U.S. cities. Residents pay just $86.92 for goods and services that cost $100 nationally, according to Bureau of Economic Analysis data cited by Realtor.com.

The South and Midwest lead the rankings when it comes to affordability, with Texas claims two spots among the 10 most economical metropolitan areas. According to John Macke, senior research analyst at John Burns Research and Consulting, housing costs were the main factor behind the ranking.

“Looking specifically at regional price parity data from the BEA, it is the housing component that is much lower in these metropolises than in others, making it the main factor in lowering the cost of living,” Macke told Realtor.

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McAllen’s affordability stems from several factorsincluding its trade-based economy and lack of state income tax. “McAllen’s location near the Mexican border has fueled a trade-based economy and manufacturing jobs,” real estate agent Cara Ameer told Realtor. “There is a lot of land to develop, which helps keep prices more affordable. »

The city’s median home price of $275,000 reflects the affordability advantage. “Nationally, the house price-to-income ratio was around 5.5 in August 2024, meaning house prices are 5.5 times the median household income,” Macke said. “In a city like McAllen, Texas (4.8), housing prices are much lower relative to incomes.”

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Wichita, Kansas, ranks second, with residents paying $89.16 per $100 in national average costs.

Little Rock, Arkansas, is in third place, at $89.15 per $100, attracting residents of states with higher costs. “Arkansas has become very popular with Californians, who can enjoy affordability, a milder climate and an abundance of recreational opportunities,” Ameer says.

Other notable towns cited by the real estate agent include:

• Toledo, Ohio ($90.18): The “Glass Capital of the World” offers particularly affordable transportation costs

• Scranton, Pennsylvania ($91.90): Has much lower property taxes than the Philadelphia suburbs

• Dayton, Ohio ($91.39): Benefits from a diversified economy without technology-related cost inflation

• Tulsa, Oklahoma ($90.53): Combines cultural amenities with Midwest affordability

• Akron, Ohio ($92.05): offers attractive property tax reduction programs

• Birmingham, Alabama ($91.15): Provides access to major healthcare facilities

• El Paso, Texas ($91.21): Remains affordable despite Texas’ growing popularity

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“Metropolitan cities with the lowest costs of living are largely concentrated in the South and Midwest,” Hannah Jones, senior economic research analyst at Realtor.com, said in the report. “These areas tend to be smaller, with only Birmingham, Alabama accounting for the 50 largest U.S. metros.”

Housing costs in these more affordable markets are typically $100,000 or more lower than the national median, according to September data. However, some cities, like El Paso, could lose their affordability advantage as mortgage rates decline.

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This item Where $100 Only Costs $86 – The 10 Cheapest Cities to Live in America originally appeared on Benzinga.com

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