Arizona · Population 186,419 · Updated March 2026
How far your income goes in Tempe
State-level tax rates that affect your costs
Tempe has a significantly higher cost of living than most US cities, driven largely by premium housing costs. With a cost index of 120 (where 100 equals the national median), Tempe residents can expect to pay median rent of $1,623/month while earning a median household income of $77,643/year.
The median home value in Tempe, AZ is $421,900, with typical monthly owner costs around $1,554 including mortgage, insurance, and taxes. With a rent-to-income ratio of 25.1%, Tempe falls within the generally affordable range, though it's approaching the 30% burden threshold.
Arizona has a moderate income tax rate of 2.5%. Combined with a 5.6% sales tax rate and 0.62% effective property tax rate, the overall tax environment is a factor in the total cost of living in Tempe.
Common questions about living costs in Tempe