One of the biggest problems with inflation is that once it has burrowed into an economy, it is very difficult to rid of it. Just when Federal Reserve policymakers thought they might have finally gotten the better of the inflation that gripped the U.S. economy following the pandemic, along came the specter of tariffs.
Inflation varies by location. Corporate executives know this, too. As they seek locations that are more attractive to prospective employees, living costs are a key consideration. That is why we consider Cost of Living as one of ten categories of competitiveness in CNBC’s annual rankings of America’s Top States for Business.
Under this year’s methodology, the category is worth 2.4% of a state’s overall score. We rate the states based on an index of prices for a broad range of goods and services calculated by the Council for Community and Economic Research, or C2ER. We also consider housing affordability. And, with an insurance crisis spreading across the country, we measure the cost to insure a median-priced home based on the most recent available data.
Some states are seeing relatively tame inflation, even now. But others, like the states we are about to tour, are more susceptible to higher prices. Based on the 2025 Cost of Living category points totals — which results in some tie scores between states though only one that can be called the nation’s “most expensive” — here are America’s most expensive states to live in, along with average prices in 2024 of some basic items in key metro areas.
Arizona
Afternoon aerial view of dense urban core of Surprise, Arizona, USA.
Mattgush | Istock | Getty Images
According to the city’s website, Surprise, Arizona, located northwest of Phoenix, got its name in 1938 when its founder, Flora Mae Statler, declared that she would be surprised if the town ever amounted to much.
Today, the name might also refer to the reaction when people open their utility bills in Arizona. The total energy bill per household in the community of around 143,000 people is nearly three times as much as in Monroe, Louisiana, largely because of all the air conditioning. But people keep coming to the Grand Canyon State, and that is raising housing costs. Nearly one-third of Arizonans — among the highest percentage of any state — are paying more than 30% of their household income for housing.
2025 Cost of Living Score: 22 out of 60 points (Top States Grade: D)
Consumer Price Index (May, West Region): +2.4%
Annual Homeowner’s Insurance: $3,243
Average Home Price (Surprise): $445,836
Dozen Eggs (2024): $2.94
Monthly Energy Bill: $355.73
Louisiana
Sun setting in Slidell, Louisiana with houses on a river.
Brad Schinkel | Istock | Getty Images
The Pelican State has historically been an inexpensive place to live, and basic items are still affordable. But much of what you save at the supermarket, you’ll likely be turning over to the insurance company in Louisiana.
Louisianans pay the second-highest homeowners premiums in the nation after Florida, and they saw the biggest increases this year — up 27%, according to online insurance marketplace Insurify. The state’s extreme weather is the major factor. The increases are infuriating residents, and sending lawmakers scrambling for solutions. Republican Gov. Jeff Landry signed multiple bills into law in May to try to address this, including tort reform and a measure giving the state insurance commissioner more control over premium increases.
2025 Cost of Living Score: 22 out of 60 points (Top States Grade: D)
Consumer Price Index (May, South Region): +2%
Annual Homeowner’s Insurance: $13,937
Average Home Price (New Orleans): $812,851
Dozen Eggs (2024): $3.19
Total Energy Bill: $116.30
Texas
San AntonioTexas suburban housing development neighborhood.
Dszc | E+ | Getty Images
As new residents flock to the Lone Star State, they are putting enormous pressure on the housing supply — and on prices. The median sale price statewide is up around 40% over the last five years, according to Redfin, though prices have begun to level off and even decline in some spots. Still, Texas housing costs take a big bite out of household budgets: about 32% of Texas homeowners and renters are paying one-third of their income or more on housing costs, according to the Census Bureau. And that doesn’t include the rapidly rising cost of homeowners insurance as the nationwide crisis grows. Texas homeowners pay the fifth-highest premiums in the nation.
2025 Cost of Living Score: 22 out of 60 points (Top States Grade: D)
Consumer Price Index (May, South Region): +2%
Annual Homeowner’s Insurance: $6,522
Average Home Price (Dallas): $477,656
Dozen Eggs (2024): $3.13
Total Energy Bill: $251.78
Washington
Aerial image of the suburban area of Seattle, WA known as Eastlake, with a view of Lake Union
Jhorrocks | E+ | Getty Images
Getting your greens in the Evergreen State will cost you some extra green. A bag of frozen sweet peas in Kent goes for about 30% more than it does in Salt Lake City. Housing is also expensive in Washington State. A state advisory commission found last year that a lack of affordable housing has reached “critical levels” statewide, leading to increased homelessness, housing instability and higher living costs, especially for low- and moderate-income families. The state Commerce Department’s Affordable Housing Advisory Board recommended more funding for affordable housing, reducing regulatory hurdles for new construction, and promoting new types of housing, all aimed at building the one million homes the group said are needed over the next 20 years.
2025 Cost of Living Score: 22 out of 60 points (Top States Grade: D)
Consumer Price Index (May, West Region): +2.4%
Annual Homeowner’s Insurance: $1,995
Average Home Price (Kent): $846,547
Dozen Eggs (2024): $3.63
Total Energy Bill: $164.21
Maryland
One of the key ingredients of authentic Maryland crab cakes — in addition to authentic Maryland crab meat— is eggs. And they are even pricier in Bethesda than in the rest of the country. C2ER took its price surveys in the first half of 2024, so the data doesn’t reflect the price spike earlier this year. But the regional differences remain roughly constant. A dozen eggs in Bethesda are nearly 30% more expensive than they are in Portland, Maine. The Old Line State is also not holding the line on housing prices, with increases surpassing the national average. But Maryland has so far dodged the worst of the insurance crisis.
2025 Cost of Living Score: 21 out of 60 points (Top States Grade: D)
Consumer Price Index (May, South Region): +2%
Annual Homeowner’s Insurance: $2,385
Average Home Price (Bethesda): $995,716
Dozen Eggs (2024): $3.79
Total Energy Bill: $233.99
Massachusetts
Springtime view of typical brick apartment buildings on Commonwealth Avenue in Back Bay, Boston, Massachusetts.
Patrick Donovan | Moment | Getty Images
When it comes to the price of basic goods, the Bay State is the most expensive state in the continental United States (Only Hawaii has higher living costs). A major reason is the cost of housing. Roughly 34% of homeowners and renters in Massachusetts are paying more than a third of their household income on housing, according to the Census Bureau. The numbers are distorted somewhat by prices in the Boston area, where the average home price is more than $1 million, and apartment rents are roughly five times what they are paying in Des Moines, Iowa. Nonetheless, The other high costs have sparked growing concerns that young people are being priced out of Boston, and Massachusetts in general. That is a problem not just for the vibrancy of the city, but for companies wanting to attract workers.
The only reason Massachusetts does not finish lower on this list is that it still has some of the most affordable homeowners insurance in the country.
2025 Cost of Living Score: 21 out of 60 (Top States Grade: D)
Consumer Price Index (May, Boston-Cambridge-Newton): Up 3%
Annual Homeowner’s Insurance: $2,432
Average Home Price (Boston Metro): $1,039,939
Dozen Eggs (2024): $3.03
Total Energy Bill: $371.03
New York
Utica is a city in the Mohawk Valley and the county seat of Oneida County, New York
Denistangneyjr | Istock | Getty Images
While it would be easy to blame New York City for skewing average costs higher in the rest of the Empire State, the fact is that in all but one of New York’s ten metropolitan areas (Utica-Rome), home prices are above the national median of $422,800. Of course, there are some places in the state that are way, way above the national average, like Manhattan, where a new home purchase will cost you about seven times the national median.
A 2024 report from the office of State Comptroller Thomas DiNapoli found that 2.9 million New Yorkers are “cost burdened” when it comes to housing, meaning they are paying more than 30% of their income on housing. And a sizeable portion of that group is “severely cost burdened,” which means they are paying more than half their income on housing.
2025 Cost of Living Score: 18 out of 60 points (Top States Grade: D–)
Consumer Price Index (May, Northeast Region): +2.4%
Annual Homeowner’s Insurance: $2,855
Average Home Price (Manhattan): $2,775,821
Dozen Eggs (2024): $3.98
Total Energy Bill: $250.27
Oregon
Condos on the Willamette River in Portland, Oregon.
Davealan | Istock | Getty Images
The cost of housing is chewing up household budgets in the Beaver State. One-third of Oregonian homeowners and renters are paying more than 30% of their household income on housing. But life can be expensive in other ways as well in Oregon. A loaf of bread in Portland, Oregon, will cost you 12% more than it would in Portland, Maine. According to MIT’s Living Wage Calculator, a living wage for a family of four in Oregon, where two adults hold jobs outside the home, is $31.48 per person. In Alabama, each adult would need to earn only $23.38.
2025 Cost of Living Score: 18 out of 60 points (Top States Grade: D–)
Consumer Price Index (May, West Region): +2.4%
Annual Homeowner’s Insurance: $1,807
Average Home Price (Portland): $723,737
Dozen Eggs (2024): $3.57
Total Energy Bill: $167.18
Colorado
Louisville, Colorado, The remains after the Marshall Fire, Colorado’s most destructive wildfire, which destroyed 1,000 homes in December 2021. The fire was spread by dry conditions and wind gusts of up to 115 miles per hour.
Ucg | Universal Images Group | Getty Images
Homeowners insurance premiums have been skyrocketing in the Centennial State — projected to rise another 11% this year, according to online insurance marketplace Insurify. That is, if you can even get insurance.
More and more Colorado homeowners are getting non-renewal notices as insurers pull back from wildfire risks in the state. In an effort to ease costs, Democratic Gov. Jared Polis in May signed a bill that requires insurance companies to offer discounts to policyholders who take risk mitigation measures, such as establishing defensible space around their property, or hardening their home against wildfires. It is not yet clear if the new law will meaningfully lower premiums as the fires grow more intense — and more expensive.
2025 Cost of Living Score: 12 out of 60 points (Top States Grade: F)
Consumer Price Index (May, West Region): +2.4%
Annual Homeowner’s Insurance: $6,630
Average Home Price (Denver): $650,555
Dozen Eggs (2024): $2.98
Total Energy Bill: $169.80
Florida
An aerial view of damaged houses are seen after Hurricane Helene made landfall in Horseshoe Beach, Florida, on September 28, 2024.
Chandan Khanna | Afp | Getty Images
The Sunshine State isn’t always sunny, of course, especially during hurricane season. Storms are growing more frequent — and severe. That has led to the worst homeowners insurance crisis in the country.
In 2022 and 2023, Republican Gov. Ron DeSantis signed a series of reforms into law, including measures making it harder to sue insurance companies. It has taken time, but DeSantis now says insurers are coming back to the state, and premiums have slowly begun to level off. Nonetheless, Floridians are still paying the highest homeowners insurance premiums in the nation. Florida also has a serious home affordability problem. More than 36% of Florida homeowners and renters are paying more than one-third of their household incomes on housing. Only Hawaii and California have a higher percentage of cost-burdened homeowners and renters.
2025 Cost of Living Score: 10 out of 60 points (Top States Grade: F)
Consumer Price Index (May, South Region): +2%
Annual Homeowner’s Insurance: $15,460
Average Home Price (Miami-Dade County): $711,025
Dozen Eggs (2024): $3.77
Total Energy Bill: $220.47
Hawaii
The suburban residential districts of Honolulu, Hawaii along the coastline just outside of downtown.
Art Wager | E+ | Getty Images
Life is full of trade-offs in the Aloha State. On the one hand, you get to live in paradise. On the other hand, you will pay some mind-boggling costs to live there. Like $2.37 for a head of lettuce in Honolulu, versus $1.87 in Richmond, Indiana. The high prices go beyond the grocery store. A visit to the optometrist will set you back almost $260, compared to just $102 in Valdosta, Georgia.
But notably, Hawaii has not yet seen the brunt of the insurance crisis. While premiums are projected to rise around 17% this year, Hawaiians are still paying among the lowest premiums in the nation.
2025 Cost of Living Score: 9 out of 60 points (Top States Grade: F)
Consumer Price Index (May, Honolulu Area): +2.7%
Annual Homeowner’s Insurance: $1,808
Average Home Price (Honolulu): $1,681,170
Dozen Eggs (2024): $3.98
Total Energy Bill: $529.02
2025’s Most Expensive State: California
An aerial view of the sun rising above homes that burned in the Eaton Fire on January 21, 2025 in Altadena, California.
Mario Tama | Getty Images
The Golden State seems aptly named. Living costs in California, all things considered, are the highest in the nation.
Nearly 40% of California homeowners and renters are paying more than one-third of their incomes for housing, the largest percentage of cost-burdened households in any state. The average home price in San Jose — the average! — is $1.86 million, according to C2ER. California homeowner’s insurance premiums were already rising before the horrific Southern California wildfires in January. After the fires, the state’s largest insurer, State Farm, managed to get California’s insurance regulator to approve a 17% premium hike, but only after threatening to leave the state. State Farm isn’t done trying to raise rates, however. The company noted in a blog post in May that it had originally asked for 30%, and that is what it is holding out for. A hearing on State Farm’s request for the remaining 13% is expected this year, the company said.
2025 Cost of Living Score: 6 out of 60 points (Top States Grade: F)
Consumer Price Index (May, West Region): +2.4%
Annual Homeowner’s Insurance: $2,930
Average Home Price (Orange County): $1,489,355
Dozen Eggs (2024): $2.96
Total Energy Bill: $250.56
