The cost of living can vary significantly from one U.S. state to the next, leaving many to wonder: why is Arizona so comparatively cheap to live in?
Arizona is considered affordable mainly due to low property costs, inexpensive utilities, and lower taxes. On top of that, the state invests in infrastructure and education, providing a high quality of life at a reduced cost.
Ready to explore more? Let’s take a closer look at why living in Arizona can stretch your dollar further, and other factors that contribute to its affordability.
Exploring Arizona: More Than Just a Desert
Arizona, also known as The Grand Canyon State, provides a unique mix of urban and rural living, offering an economical lifestyle that is attractive to many. Because of the state’s vast area and varying population densities, Arizona offers both the hustle and bustle of city life and the serenity of rural living without the high costs typically associated with them.
The Mix of Urban and Rural Living
A public transportation system connects the major cities in Arizona, making it easy to travel between the urban centres. These cities boast a myriad of job opportunities and modern amenities. Phoenix, the state’s capital city, and Tucson, home to the University of Arizona, are among the urban centres that offer affordable living conditions compared to other major cities in the country. As per the Bureau of Economic Analysis, the cost of living in Phoenix is 5% below the national average.
In contrast, the less densely populated rural Arizona provides residents with tranquillity, lower costs of living, and an opportunity to be closer to nature. Despite its lower population, rural Arizona has access to essential services like healthcare and education, making it a viable option for affordable living.
Cultural and Natural Attractions
Arizona is not just about the cost-friendly lifestyle; it’s a place full of natural wonders and cultural treasures. The Grand Canyon, Sedona’s red-rock landscapes, and the Native American heritage are just some of the attractions that Arizona takes pride in.
Tackling the Grand Canyon
Arizona is home to one of the world’s natural wonders, the Grand Canyon. Drawing millions of tourists each year, the Grand Canyon offers an extraordinary experience of hiking, white water rafting and camping. And the best part? Many of these activities are free or come at a nominal cost, allowing residents to enjoy these wonders without breaking the bank.
Experience Cultural Vibrancy in Sedona
Sedona, in contrast, offers a rich experience of art and culture. Known for its unique red-rock landscapes, Sedona has a thriving arts scene with over 40 galleries and numerous art festivals year-round. It’s also a hot spot for spiritual wellness experiences, attracting visitors worldwide. Like the Grand Canyon, Sedona’s natural beauty can be experienced without spending a lot. Many hiking trails, scenic drives, and cultural landmarks are free or have a minor entrance fee.
Decoding Arizona’s Affordable Living Cost
Arizona, fondly known as the Grand Canyon State, is not just renowned for its mesmerizing landscapes but also its affordability. Living in Arizona is surprisingly cheaper as compared to a majority of other states in the U.S. Let’s embark on a journey to decode the affordability of living in Arizona.
The Real Estate Scoop: Affordable Housing in Arizona
The housing market in Arizona offers several opportunities that attract homebuyers and renters alike. The median home value in the state is significantly lower than the national average. In Phoenix, the state’s largest city, the median home value is just around $268,000, falling below the national median. Moreover, in cities like Tucson, the median drops even lower. These glaring differences make Arizona an attractive place for settling down, especially for those who aim to make the most of their housing budget.
Rendered below is a comparison table between median home values in Arizona and the US:
|Median Home Value
How Utility Expenses Stack up in The Grand Canyon State
Another compelling aspect that makes Arizona affordable is its relatively inexpensive utility rates. The Grand Canyon State boasts lower expenses for utilities, which includes electricity, heating, cooling, water, and garbage services. According to a U.S. Energy Information Administration (EIA) report, the average residential electricity rate in Arizona is cheaper than national average.
Let’s paint a clearer picture with a comparison table:
|Electricity Rate (cents per KWh)
These savings on housing and utility costs combined make living in Arizona notably affordable. This alluring combination draws people from across the country, looking to enjoy the state’s natural beauty and reasonable living expenses, making Arizona a favored place to reside.
The Foodie’s Treat: Comparing Groceries and Eating Out Cost
One of the reasons why Arizona is such an affordable state to live in is because of the relatively low cost of groceries and eating out. Let’s delve into more detail.
Cheap yet Flavorful: Groceries in Arizona
The cost of groceries in Arizona is significantly lower compared to other states. For instance, if you love fresh produce, you’ll be happy to learn that Arizona has a thriving agricultural sector that allows residents to purchase locally grown fruits, vegetables, and meats at reasonable prices. Where a grocery bill might run up to $200 a week in other states, you can expect to spend around $150 in Arizona for the same items.
Here is a comparison of the cost of some basic grocery items in Arizona versus the national average:
|Cost in Arizona
|National Average Cost
|Milk (1 gallon)
|Bread (1 loaf)
|Chicken Breasts (1 lb)
|Potatoes (5 lb bag)
|Apples (1 lb)
As you can see, basic grocery items such as milk, bread, and produce are generally cheaper in Arizona than the national average. This, combined with the fact that Arizona has fewer taxes on groceries, makes it possible for residents to eat healthy and tasty meals without breaking the bank.
An Affordable Culinary Adventure: Dining Out in Arizona
When it comes to dining out, Arizona offers a diverse and affordable culinary scene. You can find a wide range of cuisines, from authentic Mexican food to modern fusion cuisine, at pocket-friendly prices. An average meal in an inexpensive restaurant in Arizona costs around $10-15, while a three-course meal for two in a mid-range restaurant will set you back around $50 – still lower than many other regions in the U.S.
Plus, Arizona is home to a thriving food truck scene, offering a wide variety of delicious meals on the go for those days when you just don’t feel like cooking, and just as with the restaurants, the prices are rather affordable. So whether you’re a foodie searching for your next gastronomic adventure or someone just looking for a good meal without spending a fortune, Arizona has you covered.
Getting Around: Transportation Cost in Arizona
Arizona is renowned for its affordable cost of living, and one of the factors contributing to this affordability is transportation. Whether you own a car or opt for public transportation, getting around Arizona can be quite cost-effective, making the state a desirable place for individuals and families to relocate.
Car Ownership in Arizona: Is it Budget-Friendly?
When considering the cost of living, car ownership is a significant element to take into account. The cost of owning and maintaining a vehicle can significantly impact an individual’s or a family’s budget. The good news for car owners in Arizona is that it is relatively budget-friendly compared to other states.
In Arizona, the average cost of car insurance is about $102 per month, which is below the national average. The cost of gasoline is also relatively affordable. Within the state, the price per gallon can range from anywhere between $2.50 and $3.50, depending on the current market conditions and the area of the state. The car registration process in Arizona is straightforward, and fees are relatively modest, making the whole process less stressful and more affordable than in many other states.
Navigate Public Transport on a Shooestring Budget
If you prefer to rely on public transportation, Arizona has you covered. Public transport is readily available in most of the cities, providing residents with a budget-friendly method of getting around town.
For instance, in Phoenix, the Valley Metro Rail offers affordable fares for a one-ride ticket, day pass, 7-day pass, and 31-day pass. The one-way fare is just $2.00, a day pass is $4.00, a 7-day pass is $20.00, and the cost of a 31-day pass is $64.00, making public transportation a feasible option for many.
In Tucson, the Sun Tran offers a variety of affordable passes as well. A one-way fare is $1.75, a day pass is $4.00, a 3-day pass is $10.00, a 30-day pass is $48.00, a semester pass for students is $112.00, and an annual pass is $495.00. Whether you prefer to use public transportation occasionally or every day, you will find it to be a cost-effective option in Arizona.
Overall, whether you own a car or rely on public transportation, getting around Arizona is very affordable, thus contributing to the state’s cost-effective living.
Keeping the Wallet Fat: Taxation in Arizona
Living in Arizona is remarkably affordable and one of the key factors contributing to this benefit is the taxation system in the state. Arizona’s taxation system stands out to be more favorable compared to many other states in the US, which significantly reduces the cost of living.
Income Tax Rates in The Copper State
The income tax system in Arizona is relatively simple. The state imposes a flat income tax rate on its residents. This means that irrespective of the amount of income earned, all individuals are taxed at the same rate. As of 2021, this rate stands at a surprisingly low rate of 4.50%, which is quite competitive compared to national averages.
Understanding Arizona’s Sales Tax System
Next, let’s delve into Arizona’s sales tax system. Arizonians pay relatively low sales taxes. As of 2021, Arizona’s average combined state and local sales tax rate is 8.37%, which is below the national median. This means citizens of Arizona pay less for their shopping than their counterparts in many other states.
|Type of Tax
|Combined state and local sales tax
Beyond these, Arizona also provides tax relief for property owners, especially for primary residents. The average property tax rate in Arizona stands at 0.72% of the home’s market value, which is significantly lower than the national average of 1.08%. This benefits residents who own property in Arizona, further adding to the affordability factor of living in the state.
The favorable tax rates in Arizona, whether it’s income, sales or property taxes, significantly contribute to the overall cost of living in the state. As you pay less tax, you have more money left over for other expenses such as housing, food, transportation, and entertainment giving you an overall better quality of life.
Affordable Healthcare in Arizona: Accessible or Illusion?
One of the factors that contribute to the low cost of living in Arizona is the affordability of healthcare. However, is affordable healthcare in Arizona truly accessible or merely an illusion? Let’s delve more into the health insurance costs in Arizona and the reality of medical expenses.
Navigating Health Insurance Costs in Arizona
Health insurance costs in Arizona are significantly lower compared to many other states in America. According to the Health Insurance Marketplace Calculator, a 40-year-old non-smoker making $30,000 a year would pay about $207 per month in Arizona compared to a national average of $325.
However, these costs can vary greatly depending on many factors such as the individual’s health condition, age, and selected insurance plan. Let’s take a look at an average cost comparison table.
|Average Insurance Cost
|Young Adult (21 Years)
|Adult (40 years)
|Senior (60 years)
Note: These numbers are based on Silver Plan monthly premiums in the year 2021.
The Reality of Medical Expenses in Arizona
Insurance costs are just one component of healthcare expenses. The reality of medical costs in Arizona is much more complex. According to a study published by Health Affairs in 2018, Arizona stands at 39th in the nation in overall healthcare costs, including insurance premiums, deductibles, and out-of-pocket expense. This means that, despite having lower health insurance premiums, Arizonians may end up paying more for healthcare services.
For example, a simple doctor consultation in Arizona can cost anywhere between $90 to $200 for self-paying patients, whereas the national average is between $130-$180. Emergency room visits and complex medical procedures also tend to be higher in Arizona.
However, the state government and various non-profit organizations have measures in place to help residents cope with these expenses. For instance, there are assistance programs for low-income families and individuals, and public health clinics offer services on a sliding fee scale.
In conclusion, while it’s true that health insurance costs in Arizona are often cheaper than the national average, actual healthcare costs can be higher due to various factors. Therefore, the perceived affordability of healthcare in Arizona can often seem like an illusion.
The Drawbacks: Pros and Cons of Living Affordably in Arizona
Like every other location in the world, living in Arizona has its pitfalls and advantages. A lower cost of living alone doesn’t entirely capture the full picture. Here, we dissect the pros and cons associated with reasonably-priced living in the Grand Canyon State.
The Downside of Living Cheap in the Grand Canyon State
While the lower cost of living in Arizona may seem appealing at first, it’s essential to be aware of the potential drawbacks too. Since the cost of services is low, the overall quality of public services tends to be lower than in states where taxes, and hence public service funding, are higher. This lowered quality extends from education to healthcare and infrastructure.
Arizona has been consistently ranked as one of the states having the worst public education system in the country. According to the U.S. News & World Report’s 2020 study, Arizona ranked a startling 43rd in the country for its education system. This situation is a point of concern for families considering moving to Arizona for the lower cost of living.
Additionally, like many states with desert climates, Arizona suffers from water scarcity. Surface water accounts for only a fraction of Arizona’s water supply, and the state primarily relies on the Colorado River for its water. Unfortunately, climate change has negatively impacted the river’s water availability, leading to uncertainty about future water supplies.
The Benefits of Arizona’s Lower Cost of Living
Affordable housing, coupled with low taxes, significantly contributes to the low cost of living in Arizona. With the median home price hovering around $249,300 – far lower than the national average, according to December 2020 data from Zillow – Arizona presents an inviting opportunity for aspiring homeowners, especially those from pricy markets like California.
The overall cost of living in Arizona is 5% lower than the national average. Groceries, housing, utilities, transportation, healthcare, and miscellaneous expenses like dining out and entertainment are all lower than the national average, according to the American Community Survey’s data from the U.S. Census Bureau in 2019.
Arizona also boasts of thriving job growth. As per data from the U.S. Bureau of Labor Statistics, in the pre-COVID era from 2018 to 2019, Arizona was ranked second in the nation for private sector job growth. The low cost of living combined with strong job growth make the state an attractive prospect to young workers across the country.
Lastly, the serene beauty, pleasant weather, and numerous recreational opportunities add to the appeal of Arizona. From the scenic landscapes of the Grand Canyon, Sedona, and Monument Valley, to the dynamic, buzzing locations like Phoenix, Scottsdale, and Tuscan, the impressive outdoor adventures and vibrant city life play a pivotal role in counterweighing the drawbacks of affordable living in Arizona.