Median one-bedroom rent across the cities we track is $963 in Indiana versus $877 in Kentucky. Overall, Kentucky runs roughly 9% cheaper on rent than Indiana, its main day-to-day cost driver.
Median household income across tracked cities is $62,995 in Indiana and $64,731 in Kentucky — about 3% higher in Kentucky. Indiana has a top state income tax rate of 2.95% and a 7% state sales tax; Kentucky has a top state income tax rate of 3.50% and a 6% state sales tax.
State Taxes
Sales Tax
7%
6%
+1.0 pp in Indiana
Income Tax (top rate)
2.95%
3.50%
+0.5 pp in Kentucky
Housing (median across tracked cities)
Median 1BR Rent
$963
$877
+9% in Indiana
Median Home Value
$207,000
$221,500
+7% in Kentucky
Income (median across tracked cities)
Median Household Income
$62,995
$64,731
+3% in Kentucky
Climate (median across tracked cities)
Avg Annual Temperature
53.2°F
58.2°F
+5.0°F in Kentucky
Indiana vs Kentucky — FAQ
- Is it cheaper to live in Indiana or Kentucky?
- Kentucky is cheaper on rent — its median one-bedroom of $877 runs about 9% below Indiana's $963, based on the cities we track in each state.
- How much more do you need to earn to live in Indiana than in Kentucky?
- To keep rent near the recommended 30% of gross income, based on median rent across tracked cities, you'd want to earn roughly $39,000 a year in Indiana versus $35,000 in Kentucky.
- Which has lower taxes, Indiana or Kentucky?
- Indiana has a top state income tax rate of 2.95% and a 7% state sales tax. Kentucky has a top state income tax rate of 3.50% and a 6% state sales tax.
Housing, income, and climate are medians across the 1/1 cities we track in Indiana/Kentucky — not population-weighted statewide figures. Taxes are exact state-level rates. Sources: US Census Bureau, ACS 5-Year; NOAA Climate Normals 1981–2010; Tax Foundation 2026.