How to Compare Cost of Living Between Cities Using Real Estate Data

Housing is the biggest difference in living costs between cities, so real estate data is a good place to start a comparison. But home prices alone can mislead. A fair comparison adds rents, taxes, insurance and everyday costs.

1. Compare typical home values

Zillow's Home Value Index estimates the typical home value for cities and neighborhoods, and shows how it has changed over time. Compare the same type of home, such as three-bedroom houses, in neighborhoods you'd actually consider, not just city averages.

2. Compare price per square foot

Price per square foot adjusts for size, so you can see how much space your budget buys in each place. Zillow Price/SqFt adds it to every Zillow listing card, which makes it quick to compare listings across two cities.

3. Compare rents

If you'll rent, or want to know whether buying makes sense, compare typical rents. Zillow publishes a rent index, and current rental listings show real asking rents.

4. Add the costs of owning

• Property taxes: rates vary widely between states and counties. Check a listing's tax history.
• Home insurance: much higher in areas with hurricane, wildfire or flood risk.
• HOA fees: common in newer developments and condos.
• Utilities: heating and cooling costs depend on climate.

5. Use official price indexes

• Regional Price Parities: the US Bureau of Economic Analysis estimates how prices in each state and metro area compare with the national average.
• MIT Living Wage Calculator: estimates the income needed to cover basic costs in each county, by household type.

6. Include the rest

• State and local income tax, and sales tax.
• Transport: car dependence, commute length, transit.
• Childcare, which varies hugely between areas.
• Groceries and healthcare.

A quick comparison sheet

Make a simple table with a column for each city and rows for typical home price or rent, price per square foot, property tax, insurance, utilities, income tax, transport and childcare. Fill in monthly figures, add them up, and compare the totals with what you'd earn in each place. The gap often looks very different from the headline home prices.

7. Compare against income

A cheaper city may also pay less. Compare typical salaries for your job in each place, and look at what's left after housing and taxes.

See researching a neighborhood on Zillow and how seasons affect prices.