Ft. Carson is South of the city. There is some exceedingly cheap real estate to be had if you go east a bit to say Fountain. The more you want to be "in town" and near the mountains, the more you pay. Get away from town and you can build a luxury 4,000 sq ft. semi-custom house on a half acre for $400K. Go 40 minutes out of town and you can get five acres and a nice house for half that price. Try to move to the Broadmoor neighborhood and be prepared to shell $700K for starters. Hey, rich people buy the good stuff and drive up prices. A third of the immigrants to Colorado in the last decade were from California, and real estate here is practically free compared to a mid-sized California city.
So it is not "cheap", but cost of living in Colorado Springs is the lowest on the Front Range (except Pueblo, which doesn't really count given the lack of high paying jobs). The Springs is also probably the least desirable city on the Front Range (again not counting Pueblo) if you care at all about cultural amenities or local government (this city is bought and sold by developers). This is one of many reasons why it is cheaper than the other cities, but Denver is a gorgeous hour drive up the road when you just have to get away and aren't heading West for mountain recreation.
The flip side is that it is probably the most beautiful city on the Front Range in terms of location (the city sprawl itself is really ugly, but the terrain surrounding it is magnificent). In my experience, if you have a good paying job, you will find the standard of living in combination with available amenities pretty tough to beat. It is a very nice place to raise kids if you are in a nicer neighborhood. District 12, District 20, and District 38 are all excellent school districts, which is suprising given the lack of property tax revenue. Some of the other school districts are not good. Just like anywhere else. Pricey neighborhood = good schools. Cheap neighborhood = poor schools.
As for moving to Colorado in general...the climate is unreal year round and recreation is endless. I have used an umbrella maybe 3 times in six years. I have never been biten by a bug, mosquito or otherwise, in six years. Summer evenings are always cool, and winters are blessed with warm alpine sun. It snows frequently and melts immediately.
You'll definitely be running up the bills for outdoor gear. I think you need about $10K a person to really get it all together (bike/camp/ski/climb/wheel/etc/etc). The only thing is no ocean...but if we had an ocean it would be California and none of us could afford it. I just take a trip to the ocean each year.
And you know about the wheeling or you wouldn't be asking
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Nay