Cost of Living in Karlstad, MN

With a cost of living index of 63, Karlstad, MN is one of the most affordable cities in the country. Living here is 37% cheaper than the national average and 19% below the Minnesota state average of 82. Karlstad is a small community of 622 residents.

Housing costs are the biggest factor in Karlstad's cost of living. The median monthly rent is $650 (51% below the US median of $1,319), and the median home value sits at $120,300 (61% below the national median of $304,900). At current prices, the median home costs roughly 2x the median household income — well within traditional affordability guidelines.

The median household income in Karlstad is $61,324, which is 18% lower than the national median of $75,149. Residents spend roughly 13% of household income on rent. This is a comfortable ratio, well below the 30% threshold that financial experts recommend as a maximum. Lower incomes here are balanced by the significantly lower cost of living, stretching each dollar further.

Climate is another factor for anyone considering a move to Karlstad. The area sees an average annual temperature of 37.7°F, with summers averaging 63°F and winters around 8°F. Annual rainfall totals 24.3 inches spread over roughly 117 days. Cold winters mean higher heating bills, an important cost-of-living consideration.

Data sources: US Census Bureau (ACS 2023), Zillow Home Values, HUD Fair Market Rents, BEA Regional Price Parities, BLS Average Prices, and NOAA Climate Normals. Updated monthly.