4 Tax-Friendly Cities That Are Drawing In New Residents

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Cost of living is on the rise. According to the consumer price index February data, the cost of transportation services jumped 6% year over year, while the cost of housing rose by 4.2% over the same period. Data from the U.S. Department of the Treasury shows home insurance is skyrocketing, and auto insurance increased more than 25% in 2024, CNBC reported. That’s in addition to the rising costs of groceries and basic needs.

Americans are feeling the tight squeeze in their wallets, and to help offset outrageous prices, many are turning to tax-friendly cities for financial relief.

“Cities with no state income tax, property tax incentives or other financial perks are becoming increasingly attractive to buyers, retirees and investors,” said Yawar Charlie, a Realtor and the director of estates for Christie’s International Real Estate of Southern California. “Beyond savings, these locations offer strong job markets and quality-of-life benefits, making them smart choices for relocation.”

Whether you’re a retiree looking to stretch your savings, a homebuyer or an investor, here are four cities that can help keep more money in your pocket by taking advantage of the tax savings offered.

Conroe, Texas

Surrounded by beautiful hills and pinewood forests, Conroe is a bustling city of over 108,000. That’s a 20% increase from its population in 2020, per the U.S. Census Bureau. According to Charlie, it’s a desirable destination to consider living.

“Located just north of Houston, Conroe has been experiencing a surge in new home construction, issuing over 14,000 single-family home permits from 2015 to 2024,” he explained. “Texas famously has no state income tax, which, combined with Conroe’s affordability, makes it an attractive option for new residents. The city is also benefiting from Houston’s expanding job market, offering suburban living with easy access to metropolitan opportunities.” 

Waycross, Georgia

If you’re looking for a small town but a big-city feel with a strong community, add Waycross to your shortlist of places to look. The cost of living in the state is 10% lower than the national average, with housing costs 21% lower, per RentCafe.

While the city’s population hasn’t seen much change lately, it is growing in other ways. According to BestPlaces, job growth over the next 10 years is estimated to be 50.5% — much higher than the national average of 33.5%.

“Waycross is a small but growing city offering both affordability and tax-friendly policies,” Charlie said. “Georgia does not tax Social Security benefits, making it an attractive destination for retirees looking to keep more of their income.”

Overall, this could be a great place to consider for a variety of reasons. “With easy access to outdoor recreation and a strong sense of community, Waycross is proving to be a smart financial move for those looking to relocate,” Charlie explained.  

Sioux Falls, South Dakota

Sioux Falls offers the ideal blend of small-town vibes and big-city conveniences, and it is budget-friendly. According to RentCafe, housing is 13% cheaper than the national average.

Its population is over 206,000, as of the most recent U.S. Census Bureau data. That’s an increase of over 7% since 2020.

“A long-time favorite for those looking to avoid state income tax, Sioux Falls continues to draw new residents thanks to its business-friendly environment and strong job market,” Charlie explained. “With no personal income tax, no corporate income tax and a low cost of living, it’s an ideal city for entrepreneurs and professionals looking to grow their wealth. The city’s economy remains strong, offering stability and opportunity for homebuyers and investors alike.”

Neodesha, Kansas

There aren’t many cities that extend tax savings and other beneficial rewards, but Neodesha is trying to attract new residents with a slew of incentives. This town, which is just about 100 miles from Tulsa, Oklahoma, has a population of just 2,100 and has faced difficult times with population decline, CNBC reported. 

“Now, Neodesha is offering a range of financial incentives, including no state income tax until 2026, property tax rebates and even free college tuition for qualifying families,” Charlie explained. “This small town is making a big push to bring in new homeowners and create a thriving community. For those looking for a fresh start with major financial benefits, Neodesha provides a rare opportunity to relocate with built-in savings.”  

Cutting back and saving every dollar makes a difference, so the appeal of these cities is understandable and enticing, as they offer a “powerful combination of tax benefits and economic opportunities,” Charlie said.

With so many wonderful tax-friendly cities, there are plenty of reasons to think about relocating to save money, but doing your research first is vital. “Understanding how tax policies impact real estate decisions is essential, and keeping an eye on emerging markets with strong financial incentives can help buyers and investors make strategic, long-term choices,” Charlie said.

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