Considering a move to New Mexico? With its diverse economy and regional cultures—from Albuquerque’s energy to Santa Fe’s artistic charm—the Land of Enchantment offers a unique mix of affordable living and high quality. In 2025, New Mexico’s cost of living is about 5% below the national average.
Everyday expenses remain manageable, though costs can vary by city. Housing, utilities, healthcare, and groceries all influence New Mexico’s overall cost of living. Let’s explore what you can expect to spend across the state this year.
TL;DR: Average Cost of Living in New Mexico 2025
- Cost of living index: ~5% below national average
- Average rent: $1,500 per month
- Median home price (statewide): $279,763
- Monthly utilities: Approx. $362
- Average grocery cost (Albuquerque): $307 per month
- Transportation costs: $5,300 per year
- Healthcare costs: $3,282 annually per person
- Median household income: $50,000–$56,000
- Childcare annual cost per child: ~$7,515
What Is the Average Cost of Living in New Mexico?
The average cost of living in New Mexico is closely tied to residents’ income levels. For example, most middle-class households need less income here to live comfortably compared to other states.
In fact, specialized jobs might offer salaries near $136,000; however, the majority of workers earn closer to $50,000–$56,000 annually.
Key monthly expenses include:
- Rent: $1,500 per month on average
- Utilities: $362 monthly, with electricity ranging from $90–$150
- Groceries (Albuquerque): Around $307 per month
- Transportation: Roughly $5,300 annually
- Healthcare: About $273 per month ($3,282 annually)
- Childcare: Approximately $7,515 annually per child
Housing and Rental Market in New Mexico
New Mexico’s housing market plays a major role in the state’s overall cost of living, but it also offers some clear advantages.
The average rent is about $1,500 per month. Moreover, median home prices statewide are roughly $279,763, with Albuquerque’s median closer to $375,000.
Compared to peer states:
- vs Arizona: New Mexico homes are about 32% cheaper (Arizona median $409,196).
- vs Colorado: New Mexico housing is roughly 12% more affordable; Colorado’s prices are 14% above the national average.
- vs Texas: Texas home prices are about 16% below the national average, making it slightly more affordable than New Mexico.
Major cities like Albuquerque and Santa Fe each have distinct housing styles. For example, Albuquerque balances affordability with city amenities. Meanwhile, Santa Fe tends to have a higher price tag due to its arts and cultural appeal.
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Utilities and Other Living Expenses in New Mexico
Utility costs are generally competitive, which helps keep overall expenses manageable. The average monthly utility bill is about $362, with electricity ranging from $90 to $150.
Compared to peer states:
- Colorado’s utilities are also about 14% below the national average.
- Arizona’s utilities are higher, averaging roughly $408 per month.
- Texas has utility costs near or slightly above the national average.
In addition, groceries in New Mexico are close to the national average, slightly higher than in Arizona but lower than in Colorado.
Transportation costs average about $5,300 annually. While that is a bit higher than neighboring states like Texas and Colorado, it still remains reasonable.
Furthermore, healthcare expenses here are more affordable than in Arizona and Colorado, at about $3,282 per year per individual.
Income and Job Market Overview in New Mexico
Salaries in New Mexico tend to be lower than in many peer states. As a result, this maintains affordability but can limit wage growth.
Median household income ranges between $50,000 and $56,000. Therefore, incomes in Texas, Arizona, and Colorado tend to be slightly higher.
In conclusion, although living costs are lower, this might affect economic competitiveness and wage progression.
Is It Worth Living in New Mexico?
Living in New Mexico provides a good balance between cost-efficiency and quality of life. Its lower housing and utility costs are advantages compared with many neighboring states.
Additionally, healthcare and childcare costs remain moderate and are expected to improve. For example, families and individuals who are cost-conscious will find significant value here.
However, lower average salaries and slightly higher transportation costs are important trade-offs to consider.
Regional Insights and Relocation Tips
Economic hubs such as Albuquerque, Santa Fe, and Las Cruces each shape the state’s cost landscape differently.
- Albuquerque offers urban amenities at moderate prices.
- Santa Fe commands higher prices due to its cultural scene.
- Las Cruces is more affordable with growing opportunities.
Therefore, newcomers should carefully review local market data and note that the state has introduced childcare initiatives aiming to reduce costs further.
Final Thought on New Mexico’s Cost of Living
As of 2025, New Mexico’s average cost of living remains about 5% below the national average. Housing and utilities save residents money compared to Colorado and Arizona. Meanwhile, Texas might offer slightly cheaper housing options.
Healthcare and childcare costs are moderate and expected to improve with ongoing efforts. Despite lower incomes, New Mexico provides a balanced, affordable lifestyle, making it particularly suitable for families and budget-conscious residents.
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FAQs About New Mexico’s Average Cost of Living
How affordable is renting in New Mexico?
Average rent in New Mexico is about $1,500 per month. This is roughly 10–15% cheaper than Colorado and slightly higher than in Texas.
Are home prices reasonable in New Mexico?
Median home price in New Mexico is around $279,763 statewide, significantly lower than Arizona and Colorado.
What are utility costs like in New Mexico?
Utilities in New Mexico cost about $362 per month on average, with electricity bills ranging from $90 to $150, making them competitive regionally.
Does New Mexico offer affordable childcare?
Childcare costs in New Mexico average $7,515 annually per child. New universal childcare initiatives are expected to reduce these expenses further.
Is New Mexico expensive compared to nearby states?
Cost of living in New Mexico is generally lower than Colorado and Arizona, though some expenses are slightly higher than in Texas.
