Philadelphia, PA Cost of Living (2026)

Philadelphia has a cost of living index of 108, about 8% above the national average. The housing index is 115. A one-bedroom apartment in the city rents for roughly $1,400 to $1,900 per month, and median home prices in Philadelphia proper sit around $220,000, lower than most comparable East Coast cities. The median household income is approximately $55,000. Housing is actually one of Philadelphia's stronger value propositions compared to New York, Boston, and Washington DC, and many residents can rent or buy at costs that would seem very affordable to residents of those cities.

A $100,000 salary in an average-cost city is worth about $93,000 in Philadelphia. The difference is modest. Workers who might have been priced out of New York or DC can often find reasonable housing in Philadelphia while maintaining access to Northeast Corridor rail connections to those cities. Many Philadelphia residents commute to New York or DC via Amtrak, which takes about 1.5 and 1.5 hours respectively.

Pennsylvania has a flat state income tax of 3.07%, one of the lower rates in the Northeast. Philadelphia adds a city wage tax of 3.75% for residents and 3.44% for non-residents who work in the city. That combined burden is meaningful: a Philadelphia resident earning $80,000 pays approximately $5,500 in combined city and state income taxes. New Jersey residents who commute into the city pay the non-resident rate, which is still notable.

One specific cost of living observation: Philadelphia's property taxes are relatively low on paper due to the homestead exemption and the city's assessment practices, but the real estate transfer tax on home purchases is among the highest in the country at 4% (combined state and city). Buyers of a $250,000 home pay $10,000 in transfer taxes at closing, which is a real cost that should factor into purchase decisions.