San Francisco ranks No. 1 nationwide in this dubious category

San Francisco represents many things to different people, but one thing most folks agree on is that the city isn’t cheap.

And there’s much truth to that sentiment as the San Francisco metro area actually stands atop the rest of the U.S. as the most unaffordable place in the country.

That’s according to national data from the Bureau of Economic Analysis’ Regional Price Parity Index, which measures how the prices of goods, housing and other services in particular metropolitan areas compare to the national average. Metros with a score below 100 in the index are cheaper than the national average while those above 100 are more expensive.

The San Francisco metro area — which includes Berkeley and Oakland — topped the list as the least affordable region in the country with a score of 119.8, as of 2021, the most recent year for which data was available.

That compares to San Jose region’s score of 111.6, which ranked as the seventh least affordable metro region in the country, just behind the Los Angeles region, which had a score of 113.8.

Housing was the primary factor contributing to the Bay Area’s lack of affordability. San Francisco’s housing score was 213.2, meaning prices in the region were well over than double the national average. San Jose’s housing score was even higher was 241.1.

Meanwhile, San Francisco’s scores for the price of goods (113.38) and utilities (167.47) were also well above the national average.

The nation’s most affordable metros

By contrast, McAllen, Texas, ranked as the most affordable large metro nationwide.

McAllen scored a 87.7 overall in the Regional Price Parity Index in 2021. The housing index for McAllen checked in at 56.2, significantly below the national average.

Jackson, Miss.; Chattanooga, Tenn.; Knoxville, Tenn.; Toledo, Ohio; and Memphis, Tenn., also ranked near the top of the list in terms of affordability.

On the opposite end of the spectrum, the most expensive metros were clustered largely in the Northeast and in California, alongside popular migration destinations such as Boise, Idaho, and Denver.

The affordability factor

Affordability can provide an edge for communities in the bid to attract new residents, said Andrew Latham, a financial planner and director of content at

Most of the most affordable metros are in the Midwest and the South, he noted. Those regions historically have lower housing costs, which heavily influences overall affordability. Those areas typically have lower population densities and greater availability of land than other regions, which makes it easier to build more housing, thus keeping prices down.

“As the world of work evolves and the ramifications of the pandemic continue to unfold, these metro areas may increasingly become hotspots for those seeking a balanced, cost-effective living experience,” Latham said. 

In the post, those looking for lower-cost living options usually had to accept lower pay if they moved to more affordable areas. But remote work has changed the dynamic, Latham said.

Areas with lower scores in the RPP Index “stand out as attractive options. They offer more bang for the buck without compromising on key amenities and quality of life,” Latham said. “As businesses become more flexible with remote-work policies, employees are more empowered to choose where they live, making these affordable metro areas viable options.”

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