How Much Does It Cost to Live in Phoenix?

Known as the Valley of the Sun, the Phoenix metropolitan area is one of the most popular moving destinations in the country. More than 200 people move to Phoenix every day, making it the fifth largest metropolitan area in the United States with a population of 1,733,630, according to World Population Review. The state itself ranks fifth on the U-Haul migration growth list.

Quality of life is a big factor, and a big part of that is climate. On average, Phoenix experiences 296 days with sunshine and averages a year-round temperature of 75 degrees, according to Visit Phoenix. Although temperatures top 100 degrees Fahrenheit during the summer, the annual high temperature averages 86.7. In the winter, the average high temperature is a pleasant 67 degrees. People take advantage of the sunshine throughout the year by hiking in mountainous city and regional parks, playing golf at 170 golf courses and boating at one of six lakes within 75-minutes of downtown Phoenix.

Climate isn’t the only reason people move to Phoenix, though. The area has a much lower cost of living than many other large metropolitan areas, and housing is extremely affordable compared to California, the state from which a large percentage of newcomers migrate. Good-paying jobs are plentiful, too.

Ready to move? Here’s what you need to know about living in Phoenix, including what it costs to live there.

Cost of living

According to AreaVibes, Phoenix has an overall cost of living index score of 98 percent, which is 2 percent lower than the national average. The cost of living index indicates how expensive (or inexpensive) it is to live in a particular city. If a city’s index score is higher than 100, then the cost of living is above average. If a city’s index score is lower than 100, then the cost of living is below average.

Phoenicians pay at or slightly below the national level for goods and services, groceries, healthcare and housing. It is above the national average for transportation (106) and utilities (107). The estimated monthly costs for a family of four, not including rent or mortgage, would be $3,181.74, according to Numbeo. Compared to Los Angeles, where the cost of living index score is 150, Phoenix is very affordable.

Jobs

Although the unemployment rate in Phoenix is 6.1 percent, the same as the national unemployment rate, according to the U.S. Bureau of Labor Statistics, the Arizona Commerce Authority projects 5.5 percent increase in jobs year-over-year for the next two years. Even now, jobs are plentiful in many industries including construction, health care and social assistance, professional and technical services, information technology, finance and insurance, warehousing, and manufacturing and transportation, according to Arizona@Work.

Top employers include Banner Health, American Express, Amazon, American Airlines, Dignity Health, Chase, Bank of America, U-Haul and PetSmart Inc., according to the City of Phoenix. Phoenix is also home to five Fortune 500 companies: Avnet, Freeport-McMoRan, Republic Services, Insight Enterprises and Magellan Health.

Looking for a job in tech? Phoenix is fast becoming a hub for technology. You’ll find work at GoDaddy, Intel, Honeywell, Northrup Grumman, ON Semiconductor, Microchip and similar companies.

Salary

The city’s median household income is $60,931, with a typical resident making $30,686, according to the U.S. Census data. Nationally, the median household income is $65,712, which makes it seem like salaries are below average in Phoenix. However, if you consider the entire metropolitan area, the median household income jumps to $67,896. That’s because you’ll find the tech and higher paying jobs in suburbs like Chandler, Scottsdale and Mesa.

Overall, the highest pay jobs are in management occupations, where employees make $50 per hour on average, according to Arizona@Work. Employees in computer and mathematical occupations make $41 per hour while architecture and engineering jobs pay $39 per hour.

Real estate

According to Realtor.com, the median listing home price is $375,000, with an average of $230 per square foot. This is quite a bit higher than the national median home listing price of $293,000. However, compared to Los Angeles, where the median listing home price is $979,000 and the average price per square foot is $577, the Phoenix metropolitan area is very affordable.

There are approximately 586,878 households in the metropolitan area, with an average of 2.8 people per household, according to the most recent U.S. Census Data. If you own a home, you can expect to pay approximately $1,465 in monthly housing costs compared to the national average of $1595. If you rent, you will pay an average of $1,053 per month for your home, which is slightly lower than the national average of $1,120.

Taxes

You will pay a combined state, county and city sales tax of 8.6 percent for purchases in Phoenix. However, the sales tax can be different just a few blocks away. For example, while you will pay 8.6 percent sales tax when you purchase lunch in Phoenix, you’ll pay 7.8 percent sales tax for dinner in the suburb of Chandler.

Property taxes in Maricopa County are currently $7.47 per $1,000 of home value, and what you pay in income tax depends on how much you make. Arizona has four marginal tax brackets ranging from 2.59 percent to 4.5 percent. You pay the minimum rate for your first $26,500 in earnings, 3.34 percent for earnings from $26,500 and $53,000, and so on.

All taxes combined, Arizona has one of the lowest tax rates in the nation, according to 24/7 Wall St. Working with the nonprofit Tax Foundation, 24/7 Wall St. determined Arizonans have a state and local tax burden of $3,926 per capita, the seventh lowest among all states and lower than the national average of $5,755.

Transportation

Because the metropolitan area covers more than 14,600 square miles and public transportation is limited, most people rely on cars to get to where they’re going. Unfortunately, driving in Phoenix isn’t cheap. According to Gasbuddy.com, the average price of regular unleaded gas in Phoenix is $3.13 while the national average is $3.04 (at the time this article was written). Given driving distances, that extra 10 cent average can add up.

Plan to spend a fair amount of time on the road. The average commute to work in the metropolitan area is 27.1 minutes, according to the U.S. Census Bureau. That’s roughly on track with the national average commute of 27.6 minutes.

Depending on where you live and work, you may be able to take public transportation to work instead. The 26-mile Valley Metro Rail, known locally as “the light rail,” connects downtown Phoenix to Tempe and Mesa. At its 38 stations, you can transfer to the Valley Metro Bus System. Tickets on either cost $2 for a single ride and $4 for an all-day pass. Pass are also available for seven days ($20), 15 days ($33) and 31 days ($64).

Other reasons to move to Phoenix

In addition to good jobs, reasonably-priced housing and a slightly below average cost of living, Phoenix offers an incredible quality of life. Here are some things to consider when thinking about moving to Phoenix.

  • It’s great for hikers.National Geographic listed Phoenix as one of the best cities in the nation for hiking. South Mountain Park and Preserve—one of the largest city parks in North America—has more than 50 miles of hiking trails alone!
  • It has amazing attractions. The metropolitan area is home to one of the largest music museums in the world, the Musical Instrument Museum, as well as the internationally-acclaimed Native American art collection at The Heard Museum. It also boasts a UNESCO World Heritage Site, Taliesin West, the winter home of architect Frank Lloyd Wright.
  • It’s a sports city. Phoenix is one of only 13 cities in the U.S. to have four major professional sports teams: the Arizona Diamondbacks (MB), Phoenix Suns (NBA), Arizona Cardinals (NFL), and Arizona Coyotes (NHL).

Ready to move to Phoenix?

For more information about Phoenix, check Moving.com’s City Profile Report feature. Simply enter the zip code or the state and city of your potential move to get a free report with city demographics, real estate information, quality of life factors, and more. For help the best moving company, check Moving.com’s extensive network of reputable and reliable movers.