Pennsylvania offers two major metros with very different financial profiles. Philadelphia is a high-cost city with a steep 3.75% wage tax on residents (one of the highest local income taxes in America), while Pittsburgh has become one of the most affordable major cities in the Northeast with a growing tech and healthcare economy. The state has a low 3.07% flat income tax, but local earned income taxes add 1–3.75% depending on where you live, making your effective rate highly location-dependent. Outside the two metros, Pennsylvania is largely affordable — cities like Harrisburg, Scranton, and Erie have low housing costs and moderate tax burdens. Property taxes vary widely by county, from 1.25% to over 2%.
Pennsylvania at a Glance
| Metric | Value | National Rank |
|---|---|---|
| Population (2024) | 13.0 million | 5th |
| Median household income | $72,627 | Average |
| Median home price | $260,000 | Below average |
| Cost of living index | 93 | Below average |
| State income tax | 3.07% flat | Very low |
| Sales tax | 6% (+ 2% Philadelphia) | Average |
| Property tax (effective rate) | 1.49% | Above average |
Income and Housing: Two Major Metros
Philadelphia Metro
| Area | Median Income | Median Home Price | Median Rent (2BR) |
|---|---|---|---|
| Philadelphia (city) | $55,000 | $250,000 | $1,400 |
| Main Line (Lower Merion) | $130,000 | $680,000 | $2,000 |
| Delaware County | $72,000 | $310,000 | $1,400 |
| Chester County | $110,000 | $450,000 | $1,700 |
| Bucks County | $95,000 | $420,000 | $1,600 |
Pittsburgh Metro
| Area | Median Income | Median Home Price | Median Rent (2BR) |
|---|---|---|---|
| Pittsburgh (city) | $55,000 | $225,000 | $1,200 |
| Cranberry Township | $110,000 | $380,000 | $1,500 |
| Mt. Lebanon | $100,000 | $360,000 | $1,400 |
| Monroeville | $60,000 | $210,000 | $1,100 |
Other Cities
| City | Median Income | Median Home Price | Median Rent (2BR) |
|---|---|---|---|
| Allentown/Bethlehem | $55,000 | $285,000 | $1,250 |
| Harrisburg | $40,000 | $155,000 | $1,050 |
| Lancaster | $52,000 | $280,000 | $1,200 |
| State College | $48,000 | $320,000 | $1,250 |
| Scranton | $42,000 | $170,000 | $950 |
| Erie | $40,000 | $145,000 | $850 |
Tax Complexity: Low State, High Local
Pennsylvania’s 3.07% flat state income tax is among the lowest in the nation, but local taxes change everything:
| City/Area | Local Tax (Earned Income Tax) | Total State + Local |
|---|---|---|
| Philadelphia (wage tax) | 3.75% (residents) | 6.82% |
| Pittsburgh | 3% | 6.07% |
| Scranton | 3.4% | 6.47% |
| Many suburbs | 1-1.5% | 4.07-4.57% |
Philadelphia’s 3.75% wage tax makes it one of the highest locally-taxed cities in America.
Property Tax Variance
| County | Effective Rate |
|---|---|
| Philadelphia | 1.30% |
| Allegheny (Pittsburgh) | 2.01% |
| Chester County | 1.25% |
| Monroe County (Poconos) | 1.95% |
| Centre County (State College) | 1.30% |
Pennsylvania Pros and Cons
| Financial Pros | Financial Cons |
|---|---|
| Low 3.07% flat state income tax | High local taxes (Philadelphia: 3.75%) |
| Pittsburgh is very affordable | Above-average property taxes |
| Below-average COL (93 overall) | Philadelphia wage tax deters business |
| Strong healthcare and education sectors | Rural PA losing population |
| No sales tax on groceries or clothing | Cold winters, heating costs |
Related: Cost of Living by State | State Income Tax Rates | Property Tax by State