Cost of Living in Louisiana
Things cost about ▼ 12% less in Louisiana than the national average.
What Things Cost in Louisiana
Compared to the US national average
See raw index numbers
US national average = 100. Source: BEA Regional Price Parities 2023.
Louisiana is affordable by the numbers, with a cost of living about 9% below the national average and housing roughly 24% below. New Orleans is the obvious draw: a city with a cultural identity that is completely unique in America, where the food, music, and community traditions are not transplanted from somewhere else but genuinely native. Baton Rouge offers a lower-cost alternative with the state university and government jobs. The financial picture in Louisiana is complicated by insurance: homeowner's insurance rates are among the highest in the country due to hurricane exposure, and auto insurance is also expensive due to the state's litigation environment.
Louisiana at a Glance
Taxes in Louisiana
Louisiana's state income tax tops out at 3% flat. The combined sales tax averages 4.45%, which is relatively low. Property taxes run about 0.56% of home value, which on a $198,500 median home means roughly $1,112/year.
Cities in Louisiana
Ranked from least to most expensive. Index 100 = national average.
Explore Louisiana
FAQ About Louisiana
New Orleans is more expensive than the Louisiana average but still below the national average for overall cost of living. Housing varies enormously by neighborhood: the French Quarter and Garden District are pricey, while neighborhoods like Mid-City, Gentilly, and the Westbank offer much lower costs. The hidden expense is insurance. Homeowner's insurance in the New Orleans metro often exceeds $3,000 to $5,000 per year, and flood insurance adds $700 to $2,000 more in flood zones.
Hurricane exposure is the primary driver. Louisiana's coast is directly in the path of Gulf hurricanes, and major storms (Katrina, Ida, Laura) have caused tens of billions in insured losses. The state's litigation environment also drives up auto and liability insurance costs. Multiple insurers have exited the market, reducing competition. For homeowners, insurance can be the second-largest housing expense after the mortgage itself.
Louisiana has a graduated income tax from 1.85% to 4.25%, moderate sales taxes that can exceed 9.5% when combining state and local rates, and very low property taxes (about 0.55% effective rate with a generous homestead exemption). Retirement income is largely untaxed. The overall tax burden is below the national average, but insurance costs offset much of the tax advantage.