Is it cheaper to live in Anchorage or Rochester?

Rochester, MN is cheaper. Its monthly baseline of $1,280 (1BR rent + utilities) runs about 3% below Anchorage, AK's $1,320, mainly because of electricity costs.

How much more do you need to earn to live in Anchorage than in Rochester?

To keep rent near the recommended 30% of gross income, you'd want to earn roughly $42,000 a year in Anchorage versus $44,000 in Rochester.

Which has lower taxes, Anchorage or Rochester?

Anchorage is taxed under Alaska's rules (no state income tax and no state sales tax); Rochester under Minnesota's (a top state income tax rate of 9.85% and a 6.875% state sales tax).

Anchorage vs Rochester Cost of Living 2026

Anchorage

Alaska

$1,320/mo est.

Rochester

Minnesota

$1,280/mo est.

Monthly estimate = 1BR rent + electricity + gas

A one-person monthly baseline (1BR rent plus typical utilities) runs $1,320 in Anchorage, AK versus $1,280 in Rochester, MN. Overall, Rochester, MN is roughly 3% cheaper to live in day-to-day than Anchorage, AK, driven mainly by electricity costs.

Median household income is $98,152 in Anchorage, AK and $87,767 in Rochester, MN — about 11% higher in Anchorage, AK. Alaska has no state income tax and no state sales tax; Minnesota has a top state income tax rate of 9.85% and a 6.875% state sales tax.

Anchorage, AK

Rochester, MN

Rent

Studio

$1,001

$1,080

+8% in Rochester, MN

1 Bedroom

$1,052

$1,106

+5% in Rochester, MN

2 Bedroom

$1,433

$1,243

+13% in Anchorage, AK

3 Bedroom

$1,952

$1,646

+16% in Anchorage, AK

Buying a Home

Median Home Value

$375,900

$287,500

+24% in Anchorage, AK

Income

Median Household Income

$98,152

$87,767

+11% in Anchorage, AK

Metro Median Wage (annual)

$60,200

$60,620

+1% in Rochester, MN

People & Lifestyle

Median Age

34.9 yr

36.4 yr

+1.5 yr in Rochester, MN

Homeownership

63.7%

65.4%

+1.7 pp in Rochester, MN

Bachelor's+ (25+)

37.7%

50.1%

+12.4 pp in Rochester, MN

Avg Commute

19.0 min

17.2 min

+1.8 min in Anchorage, AK

Crime (per 100k/yr)

Violent Crime

1,016.5

158.9

+84% in Anchorage, AK

Property Crime

2,796.2

1,379

+51% in Anchorage, AK

FBI Crime Data Explorer. Offenses per 100,000 residents per year; agency reporting practices vary, so this is approximate.

Climate

Avg Annual Temperature

37.4°F

45.4°F

+8.0°F in Rochester, MN

Annual Precipitation

17.9 in

33.0 in

+15.1 in in Rochester, MN

Gas

Regular Gasoline

$5.09/gal

$3.95/gal

+22% in Anchorage, AK

Area: West Coast (PADD 5) vs Minnesota.

Utilities

Electricity (¢/kWh)

28.2

16.9

+40% in Anchorage, AK

Natural Gas ($/MCF)

$14.40

$14.95

+4% in Rochester, MN

Residential, state-level averages (EIA). MCF = 1,000 cubic feet.

Groceries

Milk (gal)

$4.82

$4.31

+10% in Anchorage, AK

Bread (lb)

$2.04

$1.66

+19% in Anchorage, AK

Eggs (doz)

$2.19

$3.63

+66% in Rochester, MN

Ground Beef (lb)

$7.36

$6.77

+8% in Anchorage, AK

Chicken (lb)

$2.01

$2.10

+4% in Rochester, MN

Bananas (lb)

$0.70

$0.62

+12% in Anchorage, AK

Average prices — West vs Midwest (BLS). Regional where available, otherwise U.S. average.

State Taxes

Sales Tax (AK / MN)

None

6.875%

+6.9 pp in MN

Income Tax (top rate)

None

9.85%

+9.8 pp in MN

Anchorage vs Rochester — FAQ

Is it cheaper to live in Anchorage or Rochester?: Rochester, MN is cheaper. Its monthly baseline of $1,280 (1BR rent + utilities) runs about 3% below Anchorage, AK's $1,320, mainly because of electricity costs.
How much more do you need to earn to live in Anchorage than in Rochester?: To keep rent near the recommended 30% of gross income, you'd want to earn roughly $42,000 a year in Anchorage versus $44,000 in Rochester.
Which has lower taxes, Anchorage or Rochester?: Anchorage is taxed under Alaska's rules (no state income tax and no state sales tax); Rochester under Minnesota's (a top state income tax rate of 9.85% and a 6.875% state sales tax).

Sources: US Census Bureau, ACS 5-Year (rent, income, home value, demographics); NOAA Climate Normals 1981–2010 (climate); EIA weekly retail (gas); Tax Foundation 2026 (state taxes).