This State’s Most Expensive City Is Still Cheaper Than the Average American City

24/7 Wall St. Insights

• Nationwide, the cost of living tends to be higher in cities than in places outside of major metro areas
• Still, consumer prices can vary considerably from one city to another, and some Tennessee metro areas are more affordable for a broader range of incomes than others
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The overall cost of living has climbed at a historic pace in recent years, and the impact on American families has been both financial and psychological. A recent survey conducted by the U.S. Census Bureau found that over 57% of Americans reported difficulty affording usual household expenses in the last week, and that more than 93% of adults in the U.S. have experienced stress related to higher prices in the last two months.

According to the Consumer Price Index, the rate of inflation began to rise in early 2021, and ultimately peaked in June 2022, when the price of goods and services were 9.1% higher than they were one year earlier. While inflation has been steadily falling in recent months, the CPI remains above the Federal Reserve’s 2% target rate.

While no one was spared from rising consumer prices, in relative terms, the overall cost of living varies considerably across the country. In Tennessee, for example, goods and services were about 8.2% less expensive, on average, than they were nationwide in 2022 — the latest year of available data. Despite a lower cost of living, 57.3% of Tennessee households had difficulty paying for household expenses in the last week, and 95.2% of adults in the state reported stress resulting from rising prices. (Here is a look at the most expensive states to live in.)

Generally, Americans living in major cities are saddled with a higher cost of living than those in smaller, rural communities. According to the Bureau of Economic Analysis, goods and services are about 11.4% more expensive within U.S. metro areas than they are outside of metro areas.

In keeping with this pattern, goods and services are only about 6.7% less expensive than average across all 10 Tennessee metro areas, and 14.8% less expensive in non-metro areas. Still, the overall cost of living can vary meaningfully between one Tennessee city and another. In the state’s least expensive metro area, consumer prices are about 13.8% lower than they are nationwide on average. Meanwhile, in the state’s most expensive city, prices are only about 3.4% lower than average. (Here is a look at the most affordable town in every state.)

This is the cost of living in every Tennessee metro area, ranked.

Why It Matters

Inflation, as measured by the Consumer Price Index, hit a multi-decade high in 2022, and as of July 2024, the CPI remains well above the Federal Reserve’s 2% target. Even though prices tend to be far higher in cities than in rural communities, the vast majority of Americans — 80% according to the U.S. Census Bureau — live in an urban area. Still, consumer prices can vary considerably from one city to another, and some Tennessee metro areas are more affordable for a broader range of incomes than others.

10. Kingsport-Bristol, TN-VA

• Overall cost of living, 2022: 13.8% lower than U.S. average
• Median household income, 2022: $52,887 ($12,367 less than statewide median)
• Median home value, 2022: $185,700 ($99,100 less than statewide median)
• Metro area population: 310,483

9. Jackson, TN

• Overall cost of living, 2022: 13.2% lower than U.S. average
• Median household income, 2022: $55,720 ($9,534 less than statewide median)
• Median home value, 2022: $174,100 ($110,700 less than statewide median)
• Metro area population: 181,579

8. Johnson City, TN

• Overall cost of living, 2022: 12.5% lower than U.S. average
• Median household income, 2022: $58,660 ($6,594 less than statewide median)
• Median home value, 2022: $221,400 ($63,400 less than statewide median)
• Metro area population: 211,849

7. Morristown, TN

• Overall cost of living, 2022: 12.3% lower than U.S. average
• Median household income, 2022: $59,099 ($6,155 less than statewide median)
• Median home value, 2022: $203,500 ($81,300 less than statewide median)
• Metro area population: 146,172

6. Cleveland, TN

In the Historic Neighborhood o... (CC BY-SA 2.0) by Carol VanHook

• Overall cost of living, 2022: 10.8% lower than U.S. average
• Median household income, 2022: $62,624 ($2,630 less than statewide median)
• Median home value, 2022: $230,300 ($54,500 less than statewide median)
• Metro area population: 129,303

5. Clarksville, TN-KY

• Overall cost of living, 2022: 8.9% lower than U.S. average
• Median household income, 2022: $65,113 ($141 less than statewide median)
• Median home value, 2022: $251,800 ($33,000 less than statewide median)
• Metro area population: 336,447

4. Knoxville, TN

• Overall cost of living, 2022: 8.7% lower than U.S. average
• Median household income, 2022: $67,801 ($2,547 more than statewide median)
• Median home value, 2022: $281,900 ($2,900 less than statewide median)
• Metro area population: 906,674

3. Memphis, TN-MS-AR

Beale Street Memphis Morning (CC BY-SA 2.0) by Mobilus In Mobili

• Overall cost of living, 2022: 8.2% lower than U.S. average
• Median household income, 2022: $64,008 ($1,246 less than statewide median)
• Median home value, 2022: $244,100 ($40,700 less than statewide median)
• Metro area population: 1,330,954

2. Chattanooga, TN-GA

• Overall cost of living, 2022: 7.5% lower than U.S. average
• Median household income, 2022: $69,018 ($3,764 more than statewide median)
• Median home value, 2022: $265,800 ($19,000 less than statewide median)
• Metro area population: 573,767

1. Nashville-Davidson–Murfreesboro–Franklin, TN

• Overall cost of living, 2022: 3.4% lower than U.S. average
• Median household income, 2022: $80,034 ($14,780 more than statewide median)
• Median home value, 2022: $421,500 ($136,700 more than statewide median)
• Metro area population: 2,046,715