5 Best Cities To Survive Inflation and High Interest Rates in 2026

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Most Americans are feeling the strain of rising everyday costs. A recent survey from CouponFollow found that nearly 2 in 5 respondents felt financially insecure about affording the holidays in 2025. Everything from groceries to borrowing costs is making long-term planning more difficult.

And with the average cost of living $2,516 per person before rent, according to LivingCost.org, and the average home priced at $357,275, according to Zillow, it’s no wonder households’ budgets are stretched. Some areas make it easier than others to survive, with the Milken Institute’s 2025 Best-Performing Cities (BPC) index showing the metro areas that handle economic stress most effectively.

The following five cities stand out, based on the BPC index and factors such as local affordability and taxes, as places where day-to-day budgets are easier to manage.

Dallas

• Cost of living: $2,447
• Average home price: $303,486 (down 4.6% over the past year)
• Median annual property taxes: $6,175
• BPC ranking: 19

According to the BPC index, the Dallas-Plano-Irving metro area saw 46% wage growth from 2018 to 2023 and has a community resilience of 81.3%, both factors that can help residents manage rising costs. Home prices are reducing, offsetting higher property taxes here.

Huntsville, Alabama

• Cost of living: $1,969
• Average home price: $280,420 (down 0.9% over the past year)
• Median annual property taxes: $1,631
• BPC ranking: 4

Huntsville keeps costs low while offering a stable economy and relatively low property taxes. It ranks highly on the BPC index, which shows 77.3% of households have access to affordable housing.

Sioux Falls, South Dakota

• Cost of living: $1,827
• Average home price: $326,369 (up 1.4% over the past year)
• Median annual property taxes: $3,955
• BPC ranking: 56

The BPC index reports wage growth of 41% from 2018 to 2023 and community resilience of 85.1%, giving Sioux Falls residents confidence despite inflation. Home prices are growing, but only by a small percentage.

Brownsville, Texas

• Cost of living: $1,450
• Average home price: $189,843 (up 1.1% over the past year)
• Median annual property taxes: $3,146
• BPC ranking: 55

Brownsville is extremely affordable, with housing far below the national average. The BPC index shows 42.6% wage growth and 71.6% of households with access to affordable housing in the Brownsville-Harlingen metro area. Low overall costs and moderate property taxes should help make budgeting easier.

Fargo, North Dakota

• Cost of living: $1,663
• Average home price: $311,549 (up 3.0% over the past year)
• Median annual property taxes: $3,699
• BPC ranking: 36

Fargo pairs affordability with a resilient local economy, with community resilience at 84.1% according to the BPC index. Steady housing growth helps keep costs predictable and manageable.

Median annual property tax figures from Smart Asset, using data from the U.S. Census Bureau 1-Year American Community Survey for 2024.

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