Most affordable places to live in Iowa ranks 8th nationwide for affordable housing. The median home price is $227,500, compared to the national median of $428,000.
This means families can buy homes for half the price seen across the country. Plus, Iowa’s steady economy and close-knit communities benefits them.
Whether you want to explore the Mississippi River bluffs or enjoy the Iowa State Fair, Iowa’s affordable cities make that possible. his guide shows where your money goes farthest in one of the nation’s best-value states.
Key Takeaways
- Fort Madison offers Iowa’s lowest housing costs with median home prices at $120,800 and rents averaging $625.
- Iowa homebuyers work just 39 hours per month to afford a mortgage payment.
- Mason City delivers city amenities at small-town prices with a cost of living 11% below the national average.
- Iowa housing is 27% cheaper than the national average, with utilities running 12% less and groceries costing 3% below national benchmarks.
Comparing Most Affordable Places to Live in Iowa
| City | Median Home Price | Median Home Rent | Cost of Living vs US | Best For |
| Fort Madison | $120,800 | $625 | -60% rent | Budget-conscious retirees, manufacturing workers |
| Burlington | $121,567 | $865 | -12% | River enthusiasts, cyclists |
| Ottumwa | $128,349 | $700 | -15% | Budget-focused families |
| Keokuk | $120,000 | $650 | -14% | Retirees, wildlife enthusiasts |
| Creston | $150,400 | $700 | -12% | Small-town seekers |
| Mason City | $158,209 | $700 | -11% | Architecture enthusiasts |
| Waterloo | $167,500 | $750 | -14% | Entertainment-focused families |
7 Most Affordable Places to Live in Iowa in 2025
1. Fort Madison
Median Home Price: $120,800
Median Rent: $625
Cost of Living: 60-62% below national average for rent
Best For: Budget-conscious retirees, manufacturing workers, families seeking extreme affordability
Fort Madison sits along the Mississippi River in southeastern Iowa. It offers classic small-town hospitality with a solid industrial base. The downtown has 19th-century storefronts and walkable streets.
Top schools include Fort Madison High, Lincoln Elementary, and Richardson Elementary. These are all part of the Fort Madison Community School District.
Manufacturing drives the local economy, providing steady jobs even though options are limited. The Lee County fairgrounds host seasonal events, and Riverview Park offers fishing and picnics by the river.
However, downtown faces some vacancy issues, and older infrastructure needs ongoing upgrades. Still, many residents are finding this to be an affordable city in Iowa.
👉Find affordable living along the Mississippi River in Fort Madison. So start your Fort Madison homes for sale search today!
2. Burlington
Median Home Price: $121,567
Median Rent: $865
Cost of Living: 12% below national average
Best For: River enthusiasts, cyclists, families prioritizing character over convenience
Burlington’s Victorian charm brings real Mississippi River character. Snake Alley twists through five half-curves and two quarter-curves in just 275 feet. It’s even featured in Ripley’s Believe It or Not.
The Burlington Community School District serves about 24,000 residents. Top schools include Burlington High, Aldo Leopold Intermediate, and James Madison Elementary.
Grocery and utility costs are 3-17% lower than the national average. This makes Burlington one of the most affordable places to live in Iowa.
Though the city faces industrial decline and some neighborhoods need renewal. This balance of charm, cost savings, and community events keeps it attractive to many residents.
👉Looking for scenic river views and budget-friendly homes? Then explore Burlington homes for sale!
3. Ottumwa
Median Home Price: $128,349
Median Rent: $700 (estimated)
Cost of Living: Approximately 15-18% below national average
Best For: Budget-focused families, John Deere manufacturing workers, housing value seekers
Ottumwa embraces its blue-collar roots as the birthplace of actor Tom Arnold. Greater Ottumwa Park covers 75 acres with disc golf courses and trails.
The Ottumwa Community School District serves the community with Ottumwa High. As well as, Evans Middle, and Horace Mann Elementary schools.
John Deere facilities offer manufacturing jobs, while the Beach Ottumwa aquatic center provides summer recreation. Despite challenges like an 18.87% poverty rate and a declining population, Ottumwa remains affordable.
For families prioritizing housing value, this city balances affordability with a strong sense of community and access to local amenities. The mix of recreation, schools, and jobs keeps it a practical choice for many.
👉Ottumwa offers a mix of affordability and convenience. Therefore, begin your Ottumwa homes for sale search today!
4. Keokuk
Median Home Price: $120,000-125,000 (estimated)
Median Rent: $650 (estimated)
Cost of Living: Approximately 14-16% below national average
Best For: Retirees on fixed incomes, wildlife enthusiasts, extreme budget seekers
Keokuk sits where the Des Moines River meets the Mississippi. Lock and Dam 19 forms Lake Cooper, popular for boating and attracting bald eagles each winter.
The Keokuk Community School District serves residents. This is through Keokuk High, Hawthorne Elementary, and Washington Elementary.
Rand Park protects a Civil War-era national cemetery. The median income of $49,340 supports retirees and service workers in a community that is 89.3% white.
Yet, Keokuk faces a steady population decline of 0.5% per year and a 13% poverty rate. Jobs are in healthcare and retail, reflecting limited economic opportunities
👉Enjoy small-town charm and riverside living in Keokuk. So start exploring Keokuk homes for sale today!
5. Creston
Median Home Price: $136,700-150,400
Median Rent: $700 (estimated)
Cost of Living: Approximately 12-15% below national average
Best For: Families seeking small-town Iowa life, agricultural workers, budget-conscious retirees
Each September, hot air balloons launch from the Creston downtown square, creating magical scenes. Creston High and Middle, and Washington Elementary schools serves the residents.
McKinley Park offers swimming pools and recreation spots. While Green Valley Lake nearby provides fishing and camping. WorldAtlas.com named Creston one of the best places to call home in Iowa for 2025 due to its affordability.
Though its isolated location limits job options, and harsh winters challenge snow removal. Despite this, it appeals to those seeking traditional rural living with a friendly small-town feel.
👉Looking for peaceful living and great value? Then discover affordable Creston homes for sale today!
6. Mason City
Median Home Price: $158,209
Median Rent: $700
Cost of Living: 11% below national average
Best For: Architecture enthusiasts, families prioritizing education, healthcare professionals
The “City of Architecture” has stunning Prairie School buildings designed by Frank Lloyd Wright disciples. The Park Inn Hotel is the only remaining Frank Lloyd Wright hotel and offers public tours.
Mason City High, John Adams Middle, and Roosevelt Elementary schools serves the residents. Whereas, Lime Creek Nature center covers 110 acres of trails. Furthermore, Music Man Square honors Meredith Willson.
The median household income of $62,369 supports healthcare workers and manufacturing employees. Many choose Mason City among the most affordable Iowa cities for its blend of small-city amenities and affordability. Even though, crime rates are 27.7% above the national average.
👉Mason City offers affordability and Midwestern charm. So begin browsing Mason City homes for sale now!
7. Waterloo
Median Home Price: $167,500-173,417
Median Rent: $750-763
Cost of Living: 14% below national average
Best For: Families prioritizing entertainment, John Deere workers, young professionals
This industrial city along the Cedar River joins with Cedar Falls to form a metro area. Lost Island Waterpark has more than 1,000 parking spots that fill on summer weekends. Meanwhile, George Wyth State Park offers over 1,000 acres for hiking and windsurfing.
West High, Logan Middle, and Kingsley Elementary schools serve the Waterloo community. In May 2025, Redfin ranked Waterloo as the most affordable Iowa city. The median household income of $56,344 supports workers in manufacturing, healthcare, and education.
Cedar River Parkway features 11 miles of trails. In addition, John Deere Tractor & Engine Museum celebrates the area’s agricultural roots.
While some neighborhoods face higher property crime rates, Waterloo remains a popular affordable city Iowa families choose. It offers urban amenities with the feel of small-town prices.
👉Live affordably with access to jobs and amenities in Waterloo. Therefore, start your Waterloo homes for sale search today!
How We Ranked Iowa’s Most Affordable Cities in 2025
Our comprehensive analysis uses weighted criteria such as,
- Housing Costs (40%)
- Overall Cost of Living Index (20%)
- Employment and Income Opportunities (15%)
- Education Quality (10%)
- Crime & Safety (10%)
- Community Amenities & Lifestyle (5%)
Our data sources includes, Redfin and Zillow housing databases (April-September 2025). As well as, U.S. Census Bureau 2024 Population Estimates, RentCafe 2025 cost of living indices.
Also, Iowa Department of Education school performance profiles, FBI Uniform Crime Reports 2024, local police department statistics.
Finally, the Bureau of Labor Statistics employment data, and municipal economic development reports.
What Drives Affordability in Iowa?
Iowa housing costs are about 27% lower than the national average, while utilities are 12% cheaper and groceries run around 3% below U.S. benchmarks. The Common Sense Institute reports that the average Iowan works just 39 hours per month to afford a new mortgage payment.
Single-family home values in Iowa rose 4.7% from March 2024 to March 2025 according to Zillow, trailing the 48% national increase since 2020. Iowa’s stable agricultural economy and abundant housing supply support these affordable market conditions.
This outlook highlights most affordable places to live in Iowa.
Smart Tips For Iowa Living
- Explore Mississippi River towns like Fort Madison, Burlington, and Keokuk for extreme affordability and waterfront recreation access.
- Consider Mason City for architecture fans who want Frank Lloyd Wright heritage and arts, with costs 11% below the national average.
- Target Waterloo for families prioritizing entertainment options and urban amenities without urban price tags.
- Investigate Creston for remote workers prioritizing extreme savings over entertainment infrastructure.
- Time purchases during Iowa’s housing surplus as the state projects eliminating its 10,736-home deficit within five years under current building trends.
Should You Move To Iowa?
Iowa has true affordability in many communities, from river bluffs to glacier lakes. Housing costs are 27% below the national average, and utilities are 12% cheaper. This gives families more financial flexibility.
Many choose the most affordable places to live in Iowa for architecture in Mason City or budget options in Keokuk. Quality lifestyles remain accessible in these cities.
Iowa ranks 8th for affordable housing and expects to end its shortage within five years. Midwest towns draw new residents looking for value and friendly communities, not coastal prices.
Low costs, varied lifestyles, and plenty of homes keep Iowa high on the list for affordable U.S. living. The strong farm economy and low population support this trend.
👉Looking for affordable homes across Iowa? Then start your Iowa homes for sale search today with Houzeo and save more on your next move.
Frequently Asked Questions
What is the most affordable place to live in Iowa?
Iowa's most affordable city is, Fort Madison with median home prices at $120,800 and rents averaging $625 monthly.
What are the top 7 most affordable cities in Iowa?
The top 7 most affordable cities Iowa residents choose include Fort Madison ($120,800 median home), Burlington ($121,567), Ottumwa ($128,349), Keokuk ($120,000), Creston ($150,400), Mason City ($158,209), Waterloo ($167,500)
Which Iowa cities are best for families on a budget?
For families on a budget, Mason City, Waterloo, and Burlington are excellent choices. Mason City delivers Prairie School architecture and museum-quality arts 11% below national cost of living. Waterloo offers Iowa's largest waterpark and John Deere heritage 14% below national averages. Burlington provides Victorian river charm with Snake Alley and schools 12% below national benchmarks.
What makes Iowa one of the most affordable states?
Iowa ranks 8th nationally for housing affordability with housing costs 27% below the national average, utilities 12% cheaper, and groceries 3% less expensive. Average Iowans work 39 hours monthly to afford mortgage payments compared to 54 hours nationally.
