Cost of Living in
Amarillo, TX

The Amarillo Cost of Living Report: A 2026 Financial Autopsy

The median household income in Amarillo sits at $58,897, a figure that looks deceptively healthy on paper until you realize that "median" means half the city earns less than that. For a single individual, the threshold for basic survival without government assistance hovers around $32,393 annually. That is the price of admission, the bare minimum to keep the lights on and a roof over your head. However, relying on the COL index of 97.2—ostensibly 2.8% cheaper than the national average—is a rookie mistake. That index is an aggregate weighted by costs that don't apply to everyone, masking the specific fiscal bruises you’ll suffer in the Texas Panhandle. You aren't paying for "average"; you are paying for the specific drag of high insurance premiums and a tax structure that favors property owners until it bites them in the ass at the register.

The Big Items

Housing is the primary battlefield for your wallet, and the narrative that Amarillo is "cheap" is rapidly becoming a relic. For renters, the market offers a rare sliver of stability where you can actually predict your costs. A one-bedroom unit averages $879 per month, while a two-bedroom runs $1,082. If you are a single earner banking $32,393, that one-bedroom consumes roughly 32% of your gross income, which is right on the razor's edge of the 30% "housing burden" trap. Buying, however, is currently a high-risk gamble. While specific median home data is elusive in this dataset, the regional trend points toward a market cooling from the pandemic frenzy, but with mortgage rates likely hovering between 6.5% and 7%, the monthly payment on a median-priced home is likely double the rent. The trap here is the "Texas Property Tax." You don't get the low mortgage rate; you get the mortgage plus a tax bill that could add hundreds to the monthly nut. If you buy, you are betting on appreciation to offset the crushing weight of the tax assessment.

Taxes are where the "no state income tax" slogan falls apart. Yes, you keep 100% of your paycheck (minus the usual federal theft), but the state makes its money on the back end. The property tax rate in Potter and Randall counties is aggressive. While rates vary by district, you are looking at a total tax rate often exceeding 2.0% of the assessed value annually. On a hypothetical $250,000 home, that is $5,000 a year in pure tax—roughly $416 a month that builds zero equity. If you don't own, the state still gets you. The Texas sales tax sits at 6.25% state-mandated, plus local additions, bringing the total to 8.25% in Amarillo. Every dollar you spend on non-food items is taxed at that rate. It’s a tax on consumption, meaning the harder you work to spend, the more the state bleeds you.

Groceries and Gas show the only true "bang for your buck" in the region, but even that comes with caveats. The index suggests food is roughly 5-10% below the national baseline. You can still find a dozen eggs for a reasonable price, but the variance is local. The "Amarillo discount" applies to standard staples, but produce that isn't grown in the Panhandle carries a transportation markup. Gas is the real winner here. Being a nexus for I-40 and I-27, and sitting on top of the Permian Basin supply lines, Amarillo usually enjoys gas prices $0.20 to $0.40 below the national average. If the national average is $3.50, you might fill up for $3.15. That savings is significant if you have a long commute, but it’s quickly eaten up by the wear and tear on your vehicle from wind, sand, and hail.

Hidden 'Gotcha' Costs

The "Gotcha" costs in Amarillo are insidious because they rely on geography and weather. First, Auto Insurance. Do not underestimate this. The Panhandle is a corridor for high-speed interstate traffic and severe weather events. Hail storms are not an "if," but a "when." Comprehensive coverage premiums here are significantly higher than the national average; a clean-record driver might still pay $150+ monthly for robust coverage because the risk of a total-loss hail event is statistically high. Second, Toll Roads. While the main arteries (I-40, I-27) are free, the loop system (Soncy Road, the future expansions) is increasingly tolled. If you live in the suburbs and commute into the city center, you could easily nickel-and-dime yourself an extra $30 to $50 a month just to avoid traffic lights.

Third, HOA Fees. If you buy a home built in the last 20 years, particularly in the southwest quadrant (Soncy/Amarillo Blvd areas), you are walking into an HOA. These aren't just for mowing the median; they cover amenities you may never use. Expect $75 to $150 a month in dues that are not tax-deductible. Fourth, Utilities. The data lists electric at 14.94 cents/kWh. That is the generation rate. You also pay transmission and distribution charges. Furthermore, the climate is extreme. Summer highs consistently break 100°F, and winter lows drop into the teens. Your HVAC system runs 24/7/365. Expect summer electric bills to spike to $200-$300 for a modest home, and gas bills in winter to mirror that. There is no "mild season" to lower your bills.

Lifestyle Inflation

Lifestyle costs in Amarillo are deceptive. It feels cheap until you actually do something. A night out is the perfect example. A domestic draft beer at a standard bar is still hovering around $5.00, but a burger and fries will run you $14 to $18. Add a 8.25% sales tax and a standard 18-20% tip, and a simple dinner for two easily breaches $60. If you prefer the "fancy" steakhouses (like the famous Big Texan), you are paying big city prices.

Fitness is another trap. A standard gym membership (Planet Fitness, Chuze) will run $25 to $40 a month. However, boutique fitness (CrossFit, yoga studios) often charges $100 to $150, capitalizing on the lack of competition. Coffee is the daily bleed. A 12oz drip coffee at a local roaster like Yellow House or Evocation is $3.50 to $4.50. If you buy one every workday, that is roughly $80 a month, or $960 a year, just for caffeine. These small leaks are what keep the median income earner from saving money; the cost of "treating yourself" is nearly identical to the national average, negating the savings on housing and gas.

Salary Scenarios

The following table breaks down the raw math required to live in Amarillo in 2026. The "Single Income" assumes one earner supporting themselves, while "Family Income" assumes two earners (or one high earner) supporting a household of four.

Scenario Analysis

Frugal: This is survival mode. At $38,000 for a single person ($3,166 monthly gross), you are living in a one-bedroom apartment ($879) or a cheap roommate situation ($550). You are cooking 90% of your meals at home to avoid the 8.25% sales tax. You drive a paid-off car to avoid insurance spikes and you utilize free entertainment (Palo Duro Canyon hiking). You are saving virtually nothing. For a family of four on $65,000, this requires extreme budgeting, likely living in older neighborhoods with higher maintenance costs, and utilizing government assistance or strict meal planning. One medical emergency or car repair wipes out the monthly surplus.

Moderate: This is the "keep up with the Joneses" trap. At $52,000 for a single person ($4,333 monthly), you can afford the $1,082 two-bedroom or a small mortgage. You eat out maybe twice a week and have a decent internet plan. You might have a car payment of $350. You are likely living paycheck to paycheck with a small buffer. For a family on $88,000, this is the standard middle-class existence. You can afford a mortgage on a $250k home (roughly $1,800 with taxes/insurance), a reliable used car, and soccer fees for the kids. However, you are still susceptible to inflation. If gas jumps to $4.00 or groceries rise 10%, you are cutting into savings.

Comfortable: This is where you actually have "money." At $75,000 for a single person, you are clearing roughly $4,600 after taxes (rough estimate). You can max out a Roth IRA, drive a new vehicle, and absorb a $300 electric bill without panic. You own a home in a neighborhood with an HOA and don't flinch at the dues. For a family on $125,000, you are the top 20% of the city. You have a $2,000+ mortgage, maybe a boat or an RV, and you send the kids to private school or high-end extracurriculars. You are insulated from the nickel-and-diming of daily life because your fixed costs are covered by a healthy margin. This is the only bracket where the "low cost of living" actually feels real.