There are many factors to weigh when thinking about purchasing a new-construction home. What are the best mortgage options? What do property taxes look like?

Another big factor is the cost of living by the state in which you’re going to build. What does it cost to live there comfortably? Is there a better option across the state line?

Here’s what homebuyers should know about the cost of living in the United States before buying a new-construction home and some actual cost of living rankings.

What is the Cost of Living?

The cost of living is the amount of money required to maintain your current standard of living. It is most typically used to compare cities and states. A cost of living index measures how much basic expenses increase over time and across areas.

This cost of living comparison might be useful when determining how much home you can afford because a proper cost of living analysis will provide you with a far more comprehensive view of your budget than simply looking at housing pricing. This information can help you make a more informed decision on where to reside at this time in your life.

What Factors into the Cost of Living?

Cost of living indexes include some basic expenditures to measure their impact on your bank account. Here are some of the main data points:

• Groceries: This includes the cost of various food items.
• Health care: This will include the cost of medical visits and medicine. It may also include insurance and the costs of urgent care or hospital visits.
• Housing: Costs of housing expenditures (mortgage, homeowner's insurance, property taxes, etc.) are likely to be your largest monthly expense, whether you rent or buy a property. If you're buying, you should also consider how much money you'll need to put down as a down payment.
• Transportation: This may include the cost of gasoline and car maintenance. If you live near a major city, public transportation may be an additional factor.
• Utilities: Unless your rent includes these, you'll need to budget for the cost of water, electricity, gas, and cable/internet.

What is the Cost of Living in the U.S.?

The Council for Community and Economic Research has calculated the cost of living for the 50 U.S. states and the District of Columbia.

The CCER assigns the base state average cost of living an index level of 100. Each state is ranked against the average, with numbers lower than 100 indicating a lower-than-average cost of living. States with numbers above 100 indicate a higher-than-average cost of living.

In this cost of living table, Hawaii has the highest Cost of Living Index of 184, which is 84 points higher than the average of 100. Mississippi has the lowest Cost of Living index of 85, 15 points below the average.

Rank

This data was compiled by the Council for Community and Economic Research from self-reported state data in 2022.

What You Need to Know About Buying a Home

Choosing to build a house is an exciting and big decision. It’s important to be ready for what’s to come. The Brookfield Residential blog offers a number of resources that can help you throughout the journey. Find out about the benefits of buying a new construction home, learn the hidden costs of buying a new home, and more. When it’s time, contact us to learn more about what our homes and communities have to offer. We'll be expecting you!