Moving to a new location like Phoenix, AZ, can be a thrilling adventure, but it also means facing a potentially higher cost of living. Understanding the cost of living helps you determine how much money you need to cover basic expenses such as housing, food, transportation, and healthcare in Phoenix compared to your current location.
Simply put, the cost of living is the amount of money necessary to cover one’s basic expenses in a particular location and time period. This includes housing, food, transportation, and healthcare.
If you are considering relocating to Phoenix, we recommend you check the cost of living in this city and compare it with your current residence. Knowing whether this city is more affordable or more expensive than your present location will be advantageous.
Photo by Alexander Grey on Unsplash
What Is the Cost of Living in Phoenix, AZ?
Cost of Living Index: Phoenix, AZ
A cost-of-living index is particularly helpful if you are considering moving to Phoenix, AZ, and you want to see if living in this city would be beneficial for you and your family, given your projected income.
The cost of living index in Phoenix is higher than the national average. As of 2024, Phoenix’s overall cost of living index is 113. This means living in Phoenix is 13% more expensive than the national average. Housing is the most significant contributor to this higher cost, with a housing index of 118.6, indicating that housing costs in Phoenix are 18.6% above the national average. While groceries and healthcare are slightly below the national average, transportation and utilities also add to the higher overall cost. The average home price in Phoenix is 22.2% higher than the national average, and rents for a two-bedroom apartment are 23.8% above the national average (Expatistan, cost of living comparisons) (Redfin) (RentCafe).
| Cost of Living | Phoenix | Arizona | United States |
|---|---|---|---|
| Overall | 113 | 106.4 | 100 |
| Grocery | 97.3 | 96.1 | 100 |
| Healthcare | 92.5 | 97.3 | 100 |
| Housing | 118.6 | 119.7 | 100 |
| Utilities | 101.8 | 102.7 | 100 |
| Transportation | 117.9 | 107 | 100 |
| Miscellaneous | 105.7 | 93.7 | 100 |
As you can see from the table above, living in Phoenix, AZ, is 13% more expensive relative to the rest of the country. The highest expense is Housing, at an index of 118.6, while Grocery and Healthcare are lower than the national average.
Photo by Tom Rumble on Unsplash
Housing Costs in Phoenix
Housing remains the largest expense in Phoenix. The average home price in Phoenix is $518,848, significantly higher than the national average. Renting is also more expensive, with the average rent for a two-bedroom apartment at $1,770 per month (Expatistan, cost of living comparisons) (RentCafe). Here’s a breakdown of average rental costs:
| Monthly Rent | Phoenix, AZ |
|---|---|
| 1-Bedroom Apartment in City Center | $1,893.48 |
| 1-Bedroom Apartment Outside of Center | $1,629.52 |
| 3-Bedroom Apartment in City Center | $3,150.65 |
| 3-Bedroom Apartment Outside of Center | $2,737.57 |
Photo by Scott Warman on Unsplash
Grocery Shopping and Food Costs
As shown in the cost-of-living index table presented above, the average cost of groceries in Phoenix, AZ, is 2.7% lower compared to the national average.
The tables below show the average costs of food and grocery items, as well as the cost of dining at restaurants, to give you a better idea of how much you’ll be spending once you move to the Valley of the Sun.
| Item | Phoenix, AZ |
|---|---|
| Meal at an Inexpensive Restaurant | $20.00 |
| Three-Course Meal for 2 People at a Mid-Range Restaurant | $80.00 |
| Combo Meal at a Fast-Food Restaurant | $12.00 |
| Domestic Beer (0.5-liter draught) | $6.00 |
| Imported Beer (0.33-liter bottle) | $6.38 |
| Cappuccino (regular) | $5.68 |
| Coke/Pepsi (0.33-liter bottle) | $2.96 |
| Water (0.33-liter bottle) | $2.42 |
| Milk (1 liter) | $0.98 |
| Loaf of Fresh White Bread (500g) | $3.74 |
| Eggs (regular, 12) | $3.91 |
| Rice (white, 1kg) | $4.01 |
| Local Cheese (1kg) | $11.22 |
| Beef Round Back Leg Red Meat (1kg) | $14.15 |
| Apples (1kg) | $4.70 |
| Bananas (1kg) | $1.46 |
| Oranges (1kg) | $4.22 |
| Tomatoes (1kg) | $4.01 |
| Potatoes (1kg) | $3.07 |
| Onions (1kg) | $2.74 |
| Lettuce (1 head) | $1.91 |
| Water (1.5-liter bottle) | $2.35 |
| Bottle of Wine (Mid-Range) | $14.00 |
| Domestic Beer (0.5-liter bottle) | $2.10 |
| Imported Beer (0.33-liter bottle) | $4.34 |
Photo by Towfiqu barbhuiya on Unsplash
Utilities and Monthly Bills
The cost of utilities in Phoenix are quite affordable, at an index 101.8. Below, the table shows the average monthly bills for basic utilities, mobile plans, and internet services.
| Utilities | Phoenix, AZ |
|---|---|
| Basic (Electricity, Heating, Cooling, Water, Garbage) for 85m2 Apartment | $262.74 |
| Mobile Phone Monthly Plan with Calls and 10GB+ Data | $85.76 |
| Internet (60 Mbps or More, Unlimited Data, Cable/ADSL) | $88.88 |
Transportation Expenses
Transportation costs in Phoenix, AZ are a bit higher than the rest of the country, at an index of 106 which means that this basic expense is 6% higher than the national average.
| Transportation | Phoenix, AZ |
|---|---|
| Gasoline (1 gallon) | $4.07 |
| Tire Balancing | $57.11 |
Photo by JESHOOTS.COM on Unsplash
Healthcare Costs
The cost of living index for healthcare in Phoenix is 92.5. This means healthcare costs in Phoenix are 7.5% lower than the national average. This lower index indicates that expenses related to medical services, such as doctor visits, dentist appointments, and other healthcare services, are generally more affordable in Phoenix compared to the rest of the country (Redfin) (RentCafe).
| Healthcare | Phoenix, AZ |
|---|---|
| Optometrist | $117.56 |
| Doctor | $99.00 |
| Dentist | $102.63 |
| Ibuprofen | $12.88 |
Taxes in Phoenix
Arizona requires full-year and part-year residents to pay income tax if your gross income is more than certain thresholds, including any income earned from other states.
You’re considered a full-year resident if your permanent home is in Arizona. This includes residents who have been temporarily away but intend on returning to the state. You’re considered a part-year resident if you moved into Arizona.
The state income tax rates range from 2.59% to 4.50%. For instance, if your average salary in Phoenix is $70,000 a year, you will be taxed around $9,877.
Arizona offers tax deductions and credits to reduce your tax liability. This includes standard and itemized deductions. Your tax is $0 if your income is less than the 2022-2023 standard deduction determined by your filing status and if you’re 65 or older and/or blind.
Conclusion
Phoenix, AZ, is indeed an amazing place to live in. If you are considering relocating to this city, we hope that the information on the cost of living in Phoenix presented in this article has helped you determine if the move will be beneficial for you.
Phoenix is indeed an attractive place to live with its vibrant culture and beautiful landscapes, but it’s essential to be aware of the cost of living. If you need assistance finding a home that fits your budget and lifestyle, feel free to reach out to us. We’re here to help you make a smooth transition to your new life in Phoenix.
Contact us at (480) 888-5272 or email us at cc@ccrealestate.com for any questions or to schedule an appointment.
Frequently Asked Questions
What is the best time to move to Phoenix, Arizona?
The best time of the year to move to Phoenix, AZ, is in spring. During this time, the weather is pleasantly warm, with temperatures ranging from the 70s to the 80s (Fahrenheit).
What is the job market like in Phoenix?
The job market in Greater Phoenix is candidate-driven, with applicants possessing skills in healthcare, technology, and hospitality more likely to find the most opportunities in the current market.
Are there affordable neighborhoods in Phoenix?
Yes, the following are safe, affordable neighborhoods in Phoenix: Ahwatukee Foothills, Deer Valley, North Gateway, North Mountain Village, and South Mountain Village.
Is Phoenix a good place to live in 2023?
Definitely! Aside from beautiful scenery and an abundance of outdoor activities, Phoenix offers thriving industries and an affordable cost of living.
