Carmel, Indiana Beats 1,300 Other U.S. Cities to Be Named the Best Small City in America
CARMEL, Indiana — A midwestern city just north of Indianapolis has officially been named the best small city in America, outperforming more than 1,300 cities nationwide in a new ranking from WalletHub.
WalletHub Study Crowns Carmel as No. 1
According to the study, Carmel, Indiana, topped the list of small U.S. cities for 2025, earning high marks for affordability, quality of life, health, and economic strength.
The research analyzed U.S. cities with populations between 25,000 and 100,000, measuring 45 indicators of livability — including housing costs, education quality, crime rate, job opportunities, and local amenities.
“Carmel, IN, is the best small city to live in, due in part to strong economic factors like one of the lowest unemployment rates in the country, at 3.3%,” said Chip Lupo, a WalletHub analyst. “On top of that, the median annual household income in Carmel is nearly $135,000, which ranks among the highest in our study.”
The city also stood out for health and safety, ranking among the top 15 cities nationwide for lowest share of adults in poor health and among the lowest pedestrian fatality rates in the country.
Other Midwest Cities Also Score High
While Carmel took the top spot, several other Midwestern and Southern cities ranked near the top of WalletHub’s list:
- Brookfield, Wisconsin – 2nd place
- Apex, North Carolina – 3rd place
- Lexington, Massachusetts – 4th place
- Westfield, Indiana – 5th place
- Fishers, Indiana – 6th place
- Brentwood, Tennessee – 7th place
- Saratoga Springs, New York – 8th place
- Appleton, Wisconsin – 9th place
- Lehi, Utah – 10th place
Indiana cities in particular dominated the top rankings, with three entries in the top six, highlighting the region’s growing reputation for strong infrastructure and affordable housing.
Experts Point to Housing Affordability as Key
Economists say that housing affordability is a central reason small cities like Carmel continue to attract residents from larger urban centers.
“The most important factor, since it is the greatest advantage, is the cost of living,” said William Miles, a professor at Wichita State University. “Housing is the most important of these. Housing in small cities is much cheaper than in NYC, DC, LA, or Boston.”
Similarly, Emil Malizia, a professor at the University of North Carolina at Chapel Hill, noted that smaller cities provide “the right balance between economic opportunity and livability,” though he acknowledged that limited job diversity and slower career progression can be trade-offs.
Carmel Continues to Shine Nationally
This recognition adds to Carmel’s growing list of accolades. The city has previously been ranked among the nation’s safest, healthiest, and most family-friendly small cities. It’s also known for its thriving downtown redevelopment, vibrant arts scene, and over 140 roundabouts, which have helped reduce traffic congestion and crash rates.
The WalletHub report highlights a broader trend — as Americans move away from expensive coastal metros, many are discovering that midwestern small cities offer a high quality of life without the big-city costs.
For more updates on Midwest communities, housing trends, and local lifestyle rankings, follow ChicagoMusicGuide.com.