How Much Money Does It Take to Live in Dallas?

After spending most of our hard-earned cash to cover bare necessities, we’re sometimes pretty convinced that there’s a hole in our wallets. Has Dallas gotten more expensive in recent years, or is it just us?

Yeah, we figured we weren’t alone in feeling that way.

Relatively speaking, though, it turns out that Dallas fares pretty well in terms of affordability, said Elizabeth Renter, a data analyst with the personal finance company NerdWallet.

“Dallas is one of the more affordable large cities across the U.S. Your dollar goes further there than it would in Los Angeles or Miami, for example,” she said by email. “But this doesn’t mean Dallas residents don’t have affordability concerns — there are many, many factors that go into how financially comfortable you can be, no matter the city.”

While we may be cheaper than some coastal hubs, Dallas was recently named the world’s 53rd-priciest city for international employees, according to Axios. This comes as the number of affordable housing units dwindles and more Dallas tenants find themselves struggling to cover rising rent costs.

Even though a Dallasite could have a bigger salary than a counterpart in a different city, Renter said it’s possible that they’re also having to shell out more dough in Big D.

Here’s an example. Employees in Dallas typically earn a slightly higher income than those in Houston, but our home prices are also higher, she said. Conversely, folks in Austin both earn more and spend more on homes than we do in Dallas.

If you think your bank account has taken a hit recently, you probably aren’t imagining things. Renter said Dallas has experienced greater inflation compared with the national rate. Prices here spiked 14% over two years but just 12% across the country.

“What that tells us is unless you’ve received a raise to keep up with those rising prices, living comfortably in Dallas has gotten more difficult,” she said.

“What that tells us is unless you’ve received a raise to keep up with those rising prices, living comfortably in Dallas has gotten more difficult.” – Elizabeth Renter, NerdWallet

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Meanwhile, the average rent in Dallas-Fort Worth-Arlington is roughly $145 higher than the national median. Jon Leckie, a researcher at Rent.com, previously told the Observer that we rank as the South’s third-priciest metro area after Nashville and Austin.

In 2018, even before COVID-19 capsized the economy, 42% of households in the U.S. were having difficulty making ends meet, according to the “Wage Tool” by United for ALICE, which researches financial hardship. Households that are “ALICE” — that is: asset limited, income constrained, employed — technically bring in too much money to be considered “poor” but still can’t afford basic home expenses.

At the very minimum, an hourly wage of $14.72 per worker is needed in Dallas County to support a family of three (two adults with full-time, year-round jobs and a child), according to the Wage Tool.

Let’s brush off our calculator. Two people working 40 hours per week at that hourly wage would bring in roughly $30,618 per person annually, for a combined income of $61,235.

It’s cheaper to live in Dallas than it is in Chicago, New York, Boston or San Francisco, to name a few, according to the Dallas Regional Chamber’s cost of living index. Dallas’ housing costs are 60% less than Los Angeles’, for instance, and our transportation costs are 31% lower than Seattle’s.

Nonetheless, an increasing number of Dallasites are feeling the heat, financially speaking. Roughly half of Dallas-Fort Worth households in 2021 were “priced out of ownership of a median-priced single-family home,” according to The Dallas Morning News.

And what good is a house without food to fill it with? According to Realtor.com, locals are in luck. "Food costs in Dallas are slightly below the national average," the report stated, with single residents needing to budget $275 per month for groceries, and families with two kids and two working adults likely needing to spend $775 per month on food.

NerdWallet’s Renter offered some advice for keeping your finances under control. According to the 50-30-20 approach, 50% of your income should go toward essentials like housing and food, 30% toward non-necessities (i.e., wants) and 20% toward savings and paying off debt.

But Renter knows that such a budget isn’t doable for everyone: “This is aspirational, and not possible if you live somewhere that rent and the cost of living is extremely high,” she said.