Low cost of living and high investment in area lead to top 10 ranking
McAllen has once again been ranked number one, this time, in a recent ranking by real estate website Realtor.com, which made a list of the top 10 U.S. cities with the lowest cost of living. The information came from the latest regional price parities from the U.S. Department of Commerce’s Bureau of Economic Analysis.
“This ranking affirms what we know about McAllen: that our city offers an exceptional quality of life at an affordable cost,” said McAllen Mayor Javier Villalobos. “With a low cost of living and continuous investments in growth and infrastructure, McAllen remains a welcoming place for families, businesses, and anyone looking to make a smart financial choice for their future. We’re proud to be recognized nationally, as it reflects our commitment to making McAllen a thriving, accessible city for all.”
The regional price parities (RPP) measure the differences in price levels of goods and services across states and metropolitan areas and are shown as a percentage of the overall national price level, the BEA states.
According to Hannah Jones, senior economic research analyst at Realtor.com, markets in the South and the Midwest can expand as demand picks up, which helps keep housing costs low. The price of housing is relatively affordable because of their ability to adapt to demand.
McAllen, Texas ranked as the city with the lowest cost of living. The website ranked McAllen with a 86.92% RPP, and a cost of living 13% lower than the national average. For example, McAllen residents pay $86.82 for $100 worth of necessities and the median home price is $275,000. This is the driving force behind McAllen’s No. 1 ranking: its low housing costs in the city, according to Realtor.com. In McAllen, the home price-to-income ratio in McAllen is 4.8, meaning home prices are 4.8 times the median household income.
“McAllen has a lot of space to spread and it has been. There’s been a good amount of investment in the area and that keeps home prices relatively low,” Jones said. The supply of homes was up 41% year over year in September, she added.
“That says to me that there is ample supply given the demand in McAllen, which keeps the cost of living relatively affordable, especially when it comes to housing.”
“McAllen’s location close to the Mexico border has fueled a trade-based economy and manufacturing jobs,” says Cara Ameer, a Coldwall Banker real estate agent based in Florida. “There is no income tax in Texas, and property taxes are lower in McAllen. There is plenty of land on which to develop, which helps keep prices more affordable. In addition, McAllen has a lower cost of living, so that coupled with job opportunities helps create a more affordable environment.”
McAllen was also recently ranked number four as best U.S. cities for the middle class.
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