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Crunching costs, sorting signals, rendering insights.
Crunching costs, sorting signals, rendering insights.
Tennessee is a genuine bargain: 6 of the 6 cities in this ranking come in below the national cost-of-living average. Memphis leads at an index of 72 with rent at just $1,234/month — 35% less than the $1,895 national median. Here are the numbers, sourced from federal data updated in 2026.
#1 Ranked: Memphis — cost index 72, rent $1,234/mo, income $51,211
Memphis is a clear outlier at index 72
6 of 6 cities come in below the national cost-of-living average of 111
Data sourced from Census Bureau, Zillow, BLS, and Tax Foundation — current as of 2026
Tennessee is a genuine bargain: 6 of the 6 cities in this ranking come in below the national cost-of-living average. Memphis leads at an index of 72 with rent at just $1,234/month — 35% less than the $1,895 national median. Here are the numbers, sourced from federal data updated in 2026.
The 3.5× rule is a conservative benchmark: lenders often approve up to 4-5× income, but 3.5× keeps monthly payments safely under 28% of gross income at typical rates. On $60K, that means targeting homes under $210,000 — for better or worse — . Memphis offers a median home at $142,870 — a 2.4× ratio with room to spare (and that gap widens if you factor in state taxes).
The #1 spot goes to Memphis, and the breakdown explains why. Renters here pay $1,234/month — which, honestly, is lower than you'd expect here — — saving renters $7,932 per year compared to the national average. Meanwhile, Housing is the standout at index 72, making it one of the cheapest in the country for that category. The weak spot? Healthcare at 94. A 29% rent-to-income ratio keeps most households inside the safe zone.
Strong on paper, but not for everyone. In Memphis, the healthcare index sits at 94 — not a dealbreaker, but worth knowing about (we double-checked this one).
Memphis is a clear outlier at index 72. And for many people, #1-ranked Memphis has a cost index 16 points lower than the top-5 average of 88. That's not a marginal lead — it's a category of its own. No major red flags in that number.
Bottom line: Memphis leads this ranking for clear, data-backed reasons — but the "best" city depends on your priorities. Click into any city below to see the full detail page with 12-month trend charts, profession-specific salary data, and a breakdown of all five cost categories. If you're seriously considering a move, use our salary calculator to model your specific income against these numbers (that's pre-tax, of course).
| Rank | City | Cost Index | Median Rent | |
|---|---|---|---|---|
| 1 | Memphis | 72 | $1,234 | Details |
| 2 | Clarksville | 80 | $1,376 | Details |
| 3 | Chattanooga | 88 | $1,499 | Details |
| 4 | Murfreesboro | 98 | $1,683 | Details |
| 5 | Nashville | 103 | $1,772 | Details |
| 6 | Knoxville | 100 | $1,708 | Details |
618,639 residents · Tennessee
Dive into Memphis's numbers: cost index 72 — which, honestly, is lower than you'd expect here — (39 points below national average), rent $1,234/month, income $51,211, and a home price of $142,870. And in practical terms, the city's cost profile isn't flat — Housing is the cheapest category at 72, while Healthcare runs 94. As a major city with 618,639 residents, amenities and job markets are robust.
180,716 residents · Tennessee
Clarksville earns its position at #2 through a combination that's hard to replicate. The 80 cost index sits 31 points below the national baseline, and the $66,786 median income means purchasing power here is amplified by the low cost base. Homes list at $316,024 — $151,346 below the national median — a genuine ownership opportunity. On the cost side, Housing leads the way at 80, while Healthcare trails at 96 (a figure that keeps climbing, by the way).
187,030 residents · Tennessee
Chattanooga earns its position at #3 through a combination that's hard to replicate. The 88 cost index sits 23 points below the national baseline, and the $61,028 median income means purchasing power here is amplified by the low cost base. Homes list at $314,306 — $153,064 below the national median — a genuine ownership opportunity. On the cost side, Housing leads the way at 88, while Healthcare trails at 98 (not adjusted for inflation, but still telling).
165,430 residents · Tennessee
Dive into Murfreesboro's numbers: cost index 98 (13 points below national average), rent $1,683/month, income $76,241, and a home price of $421,928. The city's cost profile isn't flat — Housing is the cheapest category at 98, while Healthcare runs 100. With 165,430 residents, it balances mid-size city convenience with manageable costs.
687,788 residents · Tennessee
So, Nashville. And depending on your situation, cost index of 103, rent at $1,772/month. It's lower than the national average. Median income is $75,197, which is below the national median. That's more or less in line with the region (and that gap widens if you factor in state taxes).
Memphis ranks #1 in Tennessee for this analysis with a cost index of 72 and median income of $51,211.
Our cost of living index uses real Zillow rent data as the foundation, indexed to 100 (national median). Sub-categories (housing, food, transport, utilities, healthcare) are derived from the overall index with regional adjustments. Data is updated monthly.
Memphis (ranked #1) has a cost index of 72 and rent of $1,234/mo, while Knoxville (ranked #6) has a cost index of 100 and rent of $1,708/mo — a 28-point difference in cost of living.
City data is refreshed monthly from Census Bureau population estimates, Zillow rent and home price indices, BLS salary data, and Tax Foundation tax rates. Last updated: 2026.
The median 1-bedroom rent in Memphis is $1,234/month as of 2026, based on Zillow's Observed Rent Index. This is $661 below the national median of $1,895/month.
The median home price in Memphis is $142,870, which is 2.8× the local median income. That's within the standard 3.5× affordability rule for most local earners. The national median home price is $467,370.
Tennessee has a 0% state income tax rate — one of the states with no income tax. Combined state and local sales tax averages 9.55%, and the effective property tax rate is 0.56%.
This ranking was generated using data current as of early 2026. Population and income data comes from the Census Bureau's American Community Survey (5-year estimates). Rent and home price data is from Zillow's monthly releases. Tax rates are from the Tax Foundation's 2025 edition. Rankings are refreshed monthly.