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- New regional price parity data showed the varying cost of living in the US.
- California and Washington, DC, had the highest cost of living, largely driven by housing costs.
- Most of the states with the lowest relative cost of living were around the middle of the country.
Many states have a lower cost of living than the national average, but the West Coast and Northeast are still pricey.
The Bureau of Economic Analysis published new regional price parity data on Thursday that showed how expensive it is to live in different areas of the US.
“Regional price parities measure the differences in price levels across states for a given year and are expressed as a percentage of the overall national price level,” BEA said in a news release.
The new 2023 data showed 16 states and Washington, DC, had more expensive goods and services than the national average. The states with the lowest cost of living were mainly around the middle of the country, including some states in the South.
The following map shows overall regional price parities, where a value over 100 means it was above the national average. Hawaii’s figure of 108.6 means goods and services were about 9% more expensive than the average.
California had the highest relative cost of living; the state is 12.6% more expensive than the average. California metros also made up the majority of the top 10 that had the highest all-items regional price parities in 2023. The metro area of San Francisco-Oakland-Berkeley had the highest at 118.2, meaning it was almost 20% more expensive than the national average.
Washington, DC, had an ever-so-slightly higher figure than California in 2022 but fell short of California’s in 2023. DC was 10.8% more expensive than the average. New Jersey ranked right below DC.
Relatively high housing costs contributed to the overall high regional price parities in those two states and DC. BEA said rents are usually “the main driver in differences in RPPs.” DC, California, and New Jersey had the highest regional price parities for rents.
Arkansas continued to have the lowest regional price parity and was 13.5% less expensive than the national average in 2023. Alabama, West Virginia, and South Dakota were among the 10 states that were at least 10% less expensive than the national average.
