Cost of Living in Nebraska: Average Rent, Groceries, Utilities, and More

Nebraska, known as the Cornhusker State, if full of small-town charm. With a cost of living that’s consistently lower than the national average, Nebraska provides affordable housing, reasonable utility rates, and competitive healthcare costs, allowing residents to enjoy a high quality of life. Whether you’re drawn to the bustling city life of Omaha, the historic charm of Lincoln, understanding the cost of living is essential for planning your move to Nebraska. This article breaks down the key expenses you can expect, from housing and groceries to transportation and taxes, helping you determine if Nebraska is the right fit for your lifestyle and budget.

Housing costs: Median home prices and average rent in Nebraska

Nebraska stands out for its affordability in housing, offering significant savings compared to the national average. The median home sale price in the state is $287,200, which is well below the national median of $428,000. Renters in Nebraska also benefit from lower costs, with the average rent at $1,042 per month compared to the national average of $1,645. Cities like Omaha and Lincoln tend to have higher housing prices, with median home values and rents reflecting their urban appeal and amenities. On the other hand, towns such as Grand Island and Kearney provide more affordable options, making them attractive for those seeking a lower cost of living. Whether you’re looking to rent or buy, Nebraska offers diverse housing options to fit a variety of budgets.

Nebraska housing costs: Average rents and median home sale prices

Housing costs in popular cities in Nebraska

Omaha

Omaha is Nebraska’s largest city, offering diverse neighborhoods, cultural attractions, and a robust job market. Renters can expect average prices of $1,232 for a one-bedroom and $1,602 for a two-bedroom apartment, while the median home sale price stands at $270,000. Living in Omaha means enjoying a mix of historic districts and modern developments, as well as a thriving dining and arts scene.

Read more: Should I Move to Omaha, NE? 9 Pros and Cons to Consider

Lincoln

Lincoln, the state capital, combines a college-town vibe. The city has a range of rental options, with one-bedroom apartments averaging $1,234 and two-bedroom units at $1,495. For homebuyers, the median home price is $285,000. Lincoln is known for its lively downtown, schools, and a community-oriented feel.

Read more: 11 Pros and Cons of Living in Lincoln

Bellevue

Bellevue, located just south of Omaha, offers a quieter suburban lifestyle while still providing easy access to metropolitan amenities. With one-bedroom apartments averaging $1,135 and two-bedroom units at $1,386, Bellevue is slightly more affordable than its larger neighbors. The median home sale price here is $275,000. Its parks, schools, and proximity to Offutt Air Force Base make it a good place to live.

Grand Island

Grand Island stands out for its affordability. Renters will find some of the most budget-friendly options in the state, with one-bedroom apartments averaging $747 and two-bedroom units at $1,500. The median home sale price is $263,000. While smaller, Grand Island offers a great community, complemented by local events, outdoor activities, and a slower pace of life.

The cost of utilities are low in Nebraska

Utility costs in Nebraska are generally lower than the national average, making the state an appealing place to live. On average, residents pay around $113 monthly for electricity, $90 per month during peak winter months for natural gas, $23 per month for water, and typically $75 per month for waste services. Nebraska’s climate, with hot summers and cold winters, can lead to seasonal fluctuations in energy bills, especially for heating and cooling. For instance, air conditioning during the hot summer months can drive electricity costs higher, while heating costs peak during the state’s frigid winters. However, Nebraska’s reliance on locally produced energy and its public power system often result in more stable and affordable electricity rates compared to other states. 

Energy bill comparisons: Nebraska cities vs. nationwide average

Data from Redfin’s Cost of Living Calculator, November 2024

Expect to pay 5% less on groceries

Residents in Nebraska benefit from lower-than-average grocery costs, typically spending about 5% less per month compared to the national average. This means a typical household might allocate around $350–$400 monthly for groceries, depending on family size and dietary preferences. Staples like milk, bread, eggs, and fresh produce tend to be more affordable, thanks to Nebraska’s strong agricultural base. Local farmers’ markets, especially in cities like Lincoln and Omaha, provide access to fresh and budget-friendly produce, meats, and other essentials, further reducing grocery expenses for residents. 

Lower than average cost of transportation

Transportation costs in Nebraska are generally affordable, particularly when compared to national averages. Gas prices in the state stand at an average of $2.76 per gallon, significantly lower than the national average of $3.03. Residents in the eastern part of the state, particularly near cities like Omaha and Lincoln, often benefit from even lower fuel prices due to greater accessibility to refineries and distribution networks. Public transportation is available in major cities, with costs typically ranging between $1.25 and $1.50 per ride on local bus systems like Omaha’s Metro Transit and Lincoln’s StarTran. Monthly transit passes for unlimited rides in these cities are also budget-friendly, averaging around $55 to $65. These low transportation costs make it easier for residents to commute without straining their budgets, whether they rely on personal vehicles or public transit.

Healthcare costs are generally low, varying by region

Healthcare costs in Nebraska are relatively affordable compared to national averages, although they can vary depending on location and individual needs. On average, residents of Nebraska can expect to pay around $135 to $150 per month for individual health insurance premiums. However, healthcare expenses can vary depending on the specific plan and the level of coverage.  Despite these lower costs, healthcare in rural areas may present challenges in terms of accessibility, as fewer specialists and healthcare providers are available outside of larger cities like Omaha and Lincoln. 

Moderate tax structure

Nebraska has a progressive state income tax system, with rates ranging from 2.46% to 5.84% depending on income. In addition to the state income tax, Nebraska imposes property taxes, with the average effective property tax rate around 1.44%, which is higher than the national average. Sales tax in Nebraska is 5.58%, with localities adding additional sales taxes, bringing the total rate in some areas to as high as 6.97%. While Nebraska’s overall tax burden can be somewhat higher compared to other states, especially in terms of property taxes, the state does offer various deductions and exemptions to mitigate the costs for certain residents.

How much do I need to earn to live in Nebraska?

To live comfortably in Nebraska while adhering to the 30% rule, it’s recommended that no more than 30% of your gross monthly income should go toward housing expenses. For renters, the average rent in Nebraska is around $1,042 per month, which means you would need to earn at least $3,473 per month, or about $41,676 annually, to stay within the 30% rule. This ensures that your housing costs are manageable and leave room for other essential living expenses like utilities, groceries, transportation, and healthcare.

For those looking to purchase a home, the median home sale price in Nebraska is $287,200. With a 20% down payment and a 7% interest rate, your monthly mortgage payment would be approximately $1,927. To comfortably afford this, you would need to earn at least $6,424 per month, or about $77,088 annually, to keep your housing costs under 30% of your income. Keep in mind, this figure does not include other costs like property taxes, insurance, or maintenance, which could add to your monthly expenses.

By staying within the 30% rule for housing, you can ensure that your overall budget allows for a comfortable living situation without stretching your finances too thin.

Methodology

Average 1-bedroom and 2-bedroom rent sourced from Rent. Median home sale price, state average monthly rent, national rent prices, and cost of living data sourced from Redfin.