All-items parity
98.0
US = 100.0
Vermont (VT) | All-items parity 98.0
Vermont Cost of Living 2026
Vermont reads 98.0 on the BEA all-items price parity for 2024, just under the national level, with housing rents at 86.5, utilities at 125.8 (the New England heating premium), and a median home of $352,800. The signature cost is the statewide education property tax: at 1.73% effective Vermont sits in the national top handful, though an income-based credit system means most resident homeowners pay on their income rather than their house. Add a graduated income tax reaching 8.75%, partial taxation of Social Security above thresholds, and the tightest housing supply of any rural state, and Vermont is the priciest cheap-looking state in the East.
Education property tax, income-sensitizedUtilities parity 125.8Near-lowest uninsured rate
Median Home
$352,800
2BR rent $1,509/mo
Median Income
$82,730
Household, Census ACS
Category breakdown
The four BEA price parities vs the nation
| Category | VT index | National avg | Difference |
|---|---|---|---|
| All items | 98.0 | 100.0 | -2.0% |
| Services: housing rents | 86.5 | 100.6 | -14.0% |
| Goods | 97.3 | 99.6 | -2.3% |
| Services: utilities | 125.8 | 98.4 | 27.8% |
| Services: other | 101.6 | 100.1 | 1.5% |
U.S. Bureau of Economic Analysis publishes these four component parities and no others. There is no federal grocery, healthcare or transportation price parity, so this table shows none. Food at home sits inside Goods; medical and transport services sit inside Services: other.
Sources: BEA Regional Price Parities by State (table SARPP), 2024 reference year, U.S. Bureau of Economic Analysis. Census ACS 2024 1-year (median income, home value), VT Department of Taxes (education tax, income tax), Tax Foundation (effective property tax), EIA (electricity rates), KFF (uninsured rate).
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Pros / offsets
What works in Vermont.
The property tax is income-sensitized for residents. Vermont's statewide education tax funds schools centrally, and resident homesteads below the income ceilings pay a percentage of household income instead of the full house-based bill, a credit that shields most ordinary Vermont incomes from the headline 1.73% rate. Second-home owners pay the full freight by design.
Coverage and care run deep for a rural state. A 3.2% uninsured rate, among the lowest anywhere, 2.5 hospitals per capita and the UVM Medical Center's reach give Vermont healthcare access most rural states cannot match.
Rents outside Burlington stay New England-gentle. The 86.5 rents parity undercuts the national level; Rutland, Bennington and the Northeast Kingdom sell ordinary homes in the $200,000s, the state's quiet value tier.
The lifestyle dividend is real and priced in honestly. Town-meeting civic culture, the lowest-crime tier in the nation, Green Mountain access from every address and a working-landscape food economy: Vermont's premiums buy something residents measurably use.
Cons / drivers
Where Vermont costs more.
Heating a Vermont winter is a structural cost. The utilities parity of 125.8, electricity at 20.25 cents per kWh, gas averaging $118 where it exists and an old, oil-and-wood-heated housing stock make the cold months a four-figure annual line; weatherization is the best investment in the state.
Housing supply is the tightest of any rural state. Decades of slow building, Act 250 review and post-2020 in-migration left vacancy near zero; Chittenden County rents and prices run far above the state figures, and workforce housing is the legislature's perennial emergency.
Income taxes climb fast and reach 8.75%. The 3.35-8.75% schedule, partial taxation of Social Security above income thresholds, and an estate tax put Vermont's tax structure among the Northeast's heaviest for higher earners and affluent retirees.
Wages lag the costs. Median household income of $82,730 trails the national figure; the state runs on modest pay against New England prices, which is why its relocation incentives target remote workers who bring their salaries with them.
Tax + benefit signals
Vermont tax and access overview
State income tax
3.35-8.75%
Graduated or flat
Property tax effective
1.73%
Of assessed value, annual
Sales tax (state)
6.00%
Local can add 1-4% more
Uninsured rate
3.2%
Medicaid: expanded
Your take-home pay in Vermont
Federal, Vermont and any local income tax on your salary, per paycheck.
The mortgage on a $352,800 home
Monthly payment at today’s rates with Vermont property tax (1.73%) and average home insurance.
Metro variation
State averages mask city variation.
Vermont averages 98.0 on the BEA all-items parity, with one hot market and a gentle remainder:
Burlington and Chittenden County: The exception market: UVM, the medical center and the state's professional employment compress near-zero vacancy into the highest prices and rents in Vermont; Winooski and the outer towns (Milton, St. Albans) absorb the overflow.
Montpelier and central Vermont: Capital stability, Barre's granite-town housing stock below the state median, and the Mad River and Stowe resort valleys pricing like the second-home markets they are.
Rutland and Bennington: The southern value anchors: $200,000s housing, regional hospitals and genuine downtowns, with the Killington and Manchester amenity premiums nearby but not attached.
The Northeast Kingdom: Vermont's cheapest and emptiest corner: homes under $200,000, long winters, thin services and the state's strongest sense of being left alone, priced accordingly.
The resort towns (Stowe, Woodstock, Manchester) run on second-home wealth and distort every county average they touch; price them as a separate state.
Frequently Asked
Vermont cost of living, answered
How does Vermont's education property tax actually work?
School funding is statewide: every property pays the education tax, but resident homesteads below the household-income ceilings (covering most Vermont households) pay through an income-based credit instead, effectively a percentage of income rather than of house value. Non-homestead property, second homes, rentals, commercial, pays the full house-based rate. The 1.73% effective figure averages both; a modest-income resident family typically pays well under it, while a ski-house owner from Boston pays well over.
Does Vermont tax Social Security and retirement income?
Partially: Social Security is fully exempt below roughly $50,000 single / $65,000 joint AGI, with a phase-out band above, and other retirement income is taxed through the 3.35-8.75% brackets, softened by a modest military and CSRS exemption. Vermont also levies an estate tax above its exclusion. Affluent retirees price better in New Hampshire next door; moderate-income ones often find the income-sensitized property credit and healthcare access outweigh the headline rates.
Why is Vermont housing so tight?
Vermont built less housing per capita than almost any state for decades, Act 250's development review and septic-and-infrastructure limits slow rural building, and the post-2020 remote-work wave absorbed the slack permanently: vacancy sits near zero statewide and below it in Chittenden County. The $352,800 median against $82,730 median income is the visible symptom; contractors booked out a year is the daily one. Recent legislation targets permitting reform, slowly.
What does heating cost in Vermont?
Plan on $2,000 to $3,500 a season for an average oil- or propane-heated home, the majority of the stock, less with a modern heat pump and wood backup, and the 125.8 utilities parity (electricity at 20.25 cents per kWh) prices the electric side of winter too. Efficiency Vermont's weatherization and heat-pump incentives are unusually generous because the math works: insulating an 1890s farmhouse routinely repays itself in two or three winters.
Is Burlington worth its premium?
It holds most of what the state's economy offers in one small metro: UVM and the medical center's payrolls, the tech-and-remote cluster, the airport, and a lakefront downtown that functions as Vermont's only city. The premium is steep against state figures but modest against any comparable New England college metro; the binding constraint is availability, not price, with rentals scarce in every season. Winooski, Essex and St. Albans are the practical entries to the market.
Vermont or New Hampshire: the classic border question?
New Hampshire takes no income or sales tax and pays for it with the nation's near-highest house-based property tax; Vermont taxes income (to 8.75%) and sales (6%) but income-sensitizes residents' property bills. High earners and investment-income households net clearly better in New Hampshire. Moderate incomes, especially homeowners in expensive towns, can genuinely come out ahead in Vermont once the credit is counted. Healthcare coverage and town character tilt Vermont; pure arithmetic usually tilts east. The /calculator runs your actual case.