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Crunching costs, sorting signals, rendering insights.
Crunching costs, sorting signals, rendering insights.
Dollar for dollar, few states match Tennessee's value. 6 out of 6 cities undercut the national cost index of 112. Leading the pack: Memphis at index 86, where median rent of $1,234/month saves renters $7,932/year versus the national median.
| Rank | City | Utilities Index | Cost Index | Median Rent | |
|---|---|---|---|---|---|
| 1 | Memphis | 79 | 86 | $1,234 | Details |
| 2 | Clarksville | 89 | 96 | $1,376 | Details |
| 3 | Chattanooga | 90 | 98 | $1,499 | Details |
| 4 | Knoxville | 96 | 104 | $1,708 | Details |
| 5 | Murfreesboro | 98 | 106 | $1,683 | Details |
| 6 | Nashville | 99 | 108 | $1,772 | Details |
#1 Ranked: Memphis — cost index 86, rent $1,234/mo, income $51,211
6 of 6 cities come in below the national cost-of-living average of 112
Data sourced from Census Bureau, Zillow, BLS, and Tax Foundation — current as of 2026
Dollar for dollar, few states match Tennessee's value. 6 out of 6 cities undercut the national cost index of 112. Leading the pack: Memphis at index 86, where median rent of $1,234/month saves renters $7,932/year versus the national median.
Dive into Memphis's numbers: cost index 86 (26 points below national average), rent $1,234/month, income $51,211, and a home price of $142,870. And from what we can tell, the city's cost profile isn't flat — Housing is the cheapest category at 66, while Healthcare runs 89. As a major city with 618,639 residents, amenities and job markets are robust.
The utilities sub-index is derived from overall cost of living with regional BLS price adjustments. And more often than not, a score of 92 (the top-10 average here) means utilities costs are about 8% below the national median. Memphis leads at 79, followed by Clarksville (89) and Chattanooga (90). Note: a low utilities index doesn't guarantee a low overall cost — check the full cost breakdown table below.
An outlier in the best sense.
Worth noting: Here's the state-level backdrop: Tennessee averages a 100 cost index, $1,545/mo rent, and $63,576 income across 6 cities. That's $350 less than the national rent average. No income tax, Nashville boom, and Memphis blues — and that context shapes every city in this ranking.
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 (and that gap widens if you factor in state taxes).
618,639 residents · Tennessee
Why Memphis ranks #1: the numbers tell a clear story. At 86 on the cost index, residents save roughly 26% less than the typical American. Rent sits at $1,234/month while the median household pulls in $51,211/year. The Housing category is particularly strong at 66, though Healthcare (89) lags behind. Home prices average $142,870 — $324,500 below the national median.
180,716 residents · Tennessee
Dive into Clarksville's numbers: cost index 96 — though some people might weigh that differently — (16 points below national average), rent $1,376/month, income $66,786, and a home price of $316,024. The city's cost profile isn't flat — Utilities is the cheapest category at 89, while Healthcare runs 99. With 180,716 residents, it balances mid-size city convenience with manageable costs.
187,030 residents · Tennessee
A closer look at Chattanooga: the cost index of 98 breaks down to a Utilities index of 90 (strongest category) and a Healthcare index of 101 (weakest). Median rent is $1,499/month — 21% below the national median — while household income sits at $61,028, meaning locals spend about 29% of income on rent. That's within the recommended 30% threshold, though it doesn't leave much room.
198,162 residents · Tennessee
Knoxville earns its position at #4 through a combination that's hard to replicate. The 104 cost index sits 8 points below the national baseline, and the $50,994 — for better or worse — median income means purchasing power here is amplified by the low cost base. Homes list at $363,688 — $103,682 below the national median — a genuine ownership opportunity. On the cost side, Utilities leads the way at 96, while Housing trails at 110.
165,430 residents · Tennessee
Here's Murfreesboro by the numbers — and there's a lot to like (and a little to watch). Cost index: 106. Rent: $1,683/month. Income: $76,241/year. Home price: $421,928. Population: 165,430. The strongest category is Utilities at 98; the most expensive is Housing at 116. Translate that rent to annual numbers, and residents are saving renters $2,544 per year vs. the national median. That's a meaningful edge in practice.
Memphis ranks #1 in Tennessee for this analysis with a cost index of 86 and median income of $51,211.
Memphis, TN has the lowest utilities index at 79, compared to the national average of 100.
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 86 and rent of $1,234/mo, while Nashville (ranked #6) has a cost index of 108 and rent of $1,772/mo — a 22-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.