An Overview of Cost of Living in Fairbanks, AK
Understanding the cost of living in Fairbanks can help future residents assess whether their current financial situation aligns with the expenses they will encounter. It enables them to plan for potential changes in their budget and lifestyle. The Fairbanks cost of living index is 132, which is 32% higher than the national average. The cost of living index is calculated by taking into account multiple categories, which encompass both the cost of everyday expenditures and larger expenses as well.
If you value affordability in your search for a new place to live, Fairbanks may not be the most suitable option, as it stands out as one of the priciest areas in the entire United States. Only a small fraction of regions have a cost of living that is more than 20% higher than the national average, and regrettably, Fairbanks falls into this category, which may not align with your desire for an affordable place to call home.
Housing costs make up a big chunk of the cost of living in Fairbanks, and they usually eat into a large part of your take-home pay. Unfortunately, in this area, both buying a home and renting one costs 24.5% more than the average city. This includes stuff like home prices, rent, mortgage rates, and insurance.
Recurring essentials like haircuts, toothpaste, and entertainment, from movies to gym sessions, can really add up in your budget and make up 33% of the cost of living index. In Fairbanks, you you will have to spend 20.1% more than average when compared to the typical prices for these items, making it a more expensive place to live.
The surge in grocery costs is indeed alarming, especially when groceries make up a large portion of your monthly expenditures. Over the past two years, there has been an inflation of over 10% in grocery prices. Unfortunately, Fairbanks does not fare better, with grocery expenses coming in at 24.1% higher than the national average.
What Do Locals Say About the Cost of Living in Fairbanks?
Nobody knows their city better than the people who actually live there. So, we asked 14 local residents how they would rate the cost of living in Fairbanks and this is how they responded. 29% of people said that the cost of living was affordable, with prices decreasing, while 71% of people said that the cost of living was very expensive and prices continue to rise.
Is Fairbanks Affordable?
Is Fairbanks an affordable place to live? That's a valid question to ask when you're thinking about moving to a new city. After all, how much it costs to live somewhere can be a huge factor in your decision. Affordability can be broken down into 3 common categories. The cost of living index (we talked about it earlier), housing expenses and income levels all play a big role in figuring out if a place is affordable. For instance, in Fairbanks, the median home price is 17.9% higher than what most folks pay across the country, and monthly rent prices are 39.8% higher than the usual rates. Income levels in Fairbanks come in at $64,397, which is 16.4% higher than the national average.
What Factors can Influence the Cost of Living in Fairbanks?
Healthcare: Healthcare costs and insurance premiums can fluctuate greatly based on the city or state. Access to healthcare facilities, out-of-pocket expenses for doctor\’s visits, dentist costs, medication costs and specialized care costs can all impact the cost of living. In Fairbanks, the healthcare costs are 53.1% higher than the national average.
Transportation: In areas where public transportation is scarce or unavailable, residents often find themselves compelled to own and upkeep vehicles, thereby increasing the overall cost of living. Monthly expenses encompass fuel, insurance, routine maintenance and potentially lease or financing payments. In Fairbanks, the transportation index is 9.1% higher than the national average.
Housing: High demand for housing in desirable locations can drive up property prices and rental rates. This can be a primary contributor to a higher cost of living. While low demand for housing, especially in undesirable locations, can have the reverse effect and drive prices down, resulting in a lower cost of living. The housing index in Fairbanks, is 24.5% higher than the national average.
Where is the Data From?
The Fairbanks cost of living data displayed above is derived from the C2ER cost of living index to provide a useful and reasonably accurate measure of living cost differences in urban areas. The index takes into account data from 300 independent researches, covering more than 60 goods and services across 6 different categories, to create an overall index for each area, with 100 being the average. The C2ER index does not include sales or income tax rates in their data, however AreaVibes does include both income and sales tax rates in the overall cost of living score for each area.
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