This Arizona Mountain Town Is One of the Most Expensive Places to Retire—Here’s Why

When you think about retirement in Arizona, you likely imagine dry desert heat, flat landscapes, an abundance of cacti, and hot summers well in the 100s. But nestled high at an elevation of 7,000 feet, Flagstaff offers a different kind of Arizona retirement. For retirees looking to live close to the Sunbelt, this mountain town offers pine trees, snowy winters, and summer temperatures that rarely top 90 degrees. It’s a popular spot for retirees looking for a four-season climate, outdoor adventure, and small-town charm.

Flagstaff has a population of just over 76,000 and offers residents plenty of entertainment options, recreational activities, and a lively, close-knit community setting. But, there’s a catch. This desirable retirement destination can come with a hefty price tag. While retirees are drawn to the area for its natural beauty, those on a fixed income may find themselves stretching their budgets to call it home.

Here’s a closer look at what makes Flagstaff such an appealing (yet expensive) retirement destination.

Key Takeaways

• Flagstaff, Arizona, offers a cooler, four-season alternative to the state’s desert cities.
• The cost of living in Flagstaff is about 18% higher than the national average.
• The median home value is $413,200, with limited availability of single-story homes.
• High sales taxes (over 9%) and rising property values increase the tax burden, especially for retirees on fixed incomes.

Understanding the Costs

The cost of living in Flagstaff is about 18% higher than the national average. This is likely due to elevated housing prices, higher healthcare expenses, and rising local taxes. People considering relocating in retirement may need to weigh the lifestyle benefits against the potential cost of living increase (depending on where they’re moving from).

Property Prices

Flagstaff’s housing market is fairly competitive and rather unique when compared to other cities in Arizona. The median home value sits at $413,200, which is nearly identical to the national median of $416,900. There is, however, a reason why the marketplace is considered competitive for families and retirees. Single-story homes, which are often preferred by retirees thanks to their accessibility, are fairly limited.

In addition, Flagstaff continues to see a high demand for short-term rentals thanks to an increase in tourism, second-home buyers, and students attending nearby Northern Arizona University. Combined, these factors continue to keep housing inventory low and prices high. 

Housing Costs

In addition to the potentially high initial purchase price, housing costs in the area average around $1,245 per month. This amount can include common costs like your mortgage or rent payments, property taxes, utilities, and homeowners’ insurance. While that may be manageable for some retirees, it’s noticeably higher than in many other mid-sized retirement-friendly towns—especially those that aren’t impacted by tourists and university activities.

Healthcare Costs

Healthcare is another area where costs can climb quickly, especially for aging adults. Flagstaff is home to the Flagstaff Medical Center, which can provide general care for your annual check-ups and run-of-the-mill medical concerns. However, for those with chronic or complex conditions, you may need to travel to Phoenix for more specialized services. This extra travel requirement can, of course, take away time in retirement and increase potential costs—especially if frequent appointments or procedures are required.

It’s also worth considering that rural and mountain communities (like Flagstaff) can be subject to higher insurance premiums due to limited provider options. In the event you need consistent or urgent medical attention, you may find the longer appointment wait times and higher copays to be less than ideal.

There are three hospitals and 313 healthcare establishments across the county. While this is perhaps an acceptable amount for a smaller county, resources are limited compared to what’s available in larger cities across the state (like Phoenix).

Local Taxes

Arizona’s property taxes are moderate by national standards, but in Flagstaff, rising home values can lead to larger tax bills each year. Retirees should also be mindful of the city’s 9.18% combined sales tax, which is among the highest in the state. For those living on a fixed income, that can add up quickly, especially when paired with the already elevated cost of goods and services in a tourist-driven area.

Important

Take into account your monthly taxes as well when building out your retirement spending plan. These can add up to around $900 a month for Coconino County residents.

What Makes Flagstaff So Expensive?

Flagstaff is a picturesque mountain town within driving distance of incredible natural landscapes and major tourist towns like Sedona and Phoenix. Not to mention, it’s a vibrant, energetic community that brings people of all walks of life together, from college-bound teens to relaxed retirees.  

Mountain Location and Outdoor Appeal

Flagstaff’s location is one of its biggest draws. Situated at a high elevation in northern Arizona, it offers cool summers and a true four-season climate—something you won’t find in Phoenix or Tucson. Flagstaff can feel like a breath of fresh air for many retirees, especially those looking to escape the scorching heat or crowded cities.

With a comparatively milder climate comes the ability to enjoy the great outdoors (with less worry about the dangers of heat exhaustion). Residents of Flagstaff can enjoy hiking, skiing, biking, and being close to national parks like the Grand Canyon. However, the area’s natural beauty and desirable climate do contribute to the competitive housing market and higher cost of living.

Tight Housing Market

Surrounded by national forest and constrained by strict zoning laws, the land available for new residential development in Flagstaff is limited. As a result, construction tends to lag behind demand, especially when it comes to retirement-friendly housing like single-story homes or age-restricted 55 and over communities.

This issue seems further compounded by the presence of tourists and university students. Northern Arizona University brings in thousands of renters each year, while Flagstaff’s reputation as a vacation destination attracts second-home buyers, which leads to increased competition for already limited inventory.

Lifestyle Perks at a Price

Flagstaff offers the lifestyle many retirees dream of: a walkable downtown filled with local restaurants and galleries, a full calendar of festivals and community events, and clean, crisp mountain air. These lifestyle perks are part of what makes Flagstaff feel vibrant and welcoming. They also tend to push up the city’s cost of living.

Because the area caters to higher-income tourists and residents, everyday expenses like dining out, shopping, entertainment, and even home maintenance can come with a premium. 

Retirement Considerations in Flagstaff, AZ

As you continue thinking about where to move to, here are a few of the most compelling pros and cons of making Flagstaff your future retirement destination.

Pros

• Scenic setting: Flagstaff’s mountainous backdrop is truly beautiful, offering residents a sense of peace and connection to nature. 
• Ability to socialize: The city provides retirees a strong sense of community while boasting low crime rates.
• Active, health-conscious lifestyle: With hiking trails, ski slopes, national parks, and a vibrant cultural scene at your fingertips, you’ll never run out of ways to spend your retirement.
• Four seasons: Unlike the extreme heat of southern Arizona (which can impede a retiree’s ability to stay active during the summer months), Flagstaff experiences cooler summers, snowy winters, and more varied weather patterns throughout the year.

Cons

• Housing affordability: The tight real estate market, combined with high demand, means prices are steep, and options for retirement communities are limited. It’s one of the biggest barriers to retiring in Flagstaff.
• Limited access to healthcare: Not having specialized care can also be a concern for some. As you age, the likelihood of developing a chronic condition increases, and depending on the type of care needed, you may need to seek treatment in larger cities, like Phoenix.
• Overall costs: Flagstaff’s high sales tax and rising cost of living can strain your retirement income strategy, depending on your available resources in retirement.

The Bottom Line

Flagstaff gives retirees the opportunity to enjoy a four-season climate and an active community lifestyle, all of which can be hard to find elsewhere in Arizona. Flagstaff may be worth the premium price tag if you’re dreaming of enjoying a cup of coffee in the crisp morning mountain air or strolling downtown along the shops and restaurants. 

Before deciding, weigh the potential perks of moving to a city like Flagstaff against your financial situation and retirement resources. Consider visiting for an extended stay to test out what living in Flagstaff could look like (and cost), while exploring what the area offers.