Living in Mexico

My wife and I are toying with the idea of renting a house in Mexico for six months or more of the year. Although our spanish is rusty, we have each lived in latin America for a few years each (but in South America, not Mexico), and believe we could re-learn the language fairly quickly.
We're looking for a medium-sized town somewhere at a higher elevation where it's a bit cooler. In the northern part would be preferable.
Does anyone have any suggestions as to some areas where the cost of living is not too expensive, the city has something to offer to an amateur photographer and a painter, nice architecture, and an all-around nice place to live and do our photography and painting things? Oh yes, and has reasonable medical and dental care. We would prefer where the main industry is not tourism.

San Miguel de Allende is probably too touristy for you but would have most of what you are looking for.

No good answers. Just stopped in to say I'm envious.

I spent a week in San Miguel.... and totally fell in love with it! Yes, touristy, in some parts. But it also has an artist colony and places to travel outside the town. I'd live there in a hearbeat!! (and still may one day!)

Boy, I don't anything about where you're going but can I refer you and your wife as "Edward and Tina"?
What a great way to photograph a region! By spending time you become to see how the light moves around and the many cultural events.
Damn how much fun is what is ahead of you.

As it's been said above San Miguel de Allende is fantastic. However, I don't agree with the statement that it's touristy. Yes there are lots of tourists around, both mexicans and foreigners, but it's not like the place is overrun by it; it's a thoroughly Mexican town that attracts a lot of visitors because it's such a nice place. Lots of cultural activities of every kind and, as photographer and painter, you guys won't be disappointed.

Guanajuato, about a hour's drive from SMA, is larger and also a fantastic place.

I haven't been to Queretaro but I hear nice things about it.

All these places are in the Central Highlands, near each other and enjoy fantastic weather year-round.

I've spent a week or two in San Miguel and echo most of the positive comments above. It looks an easy place to live if you want access to health etc services and your Spanish isn't perfect. Its also quite easy to drive round which many Mexican cities are not. The main square is touristy- the rest of the town much less so- in general its more of an expat community than a touristic one IMO, and indeed there seems a thriving expat scene. Its very hilly which you might view as a problem or an opportunity. There's an eclectic range of restaurants.San Miguel is very colourful and photogenic, and as indicated there is decent access to other locations such as Guanajuato, Dolores Hidalgo, and the old mining area round Pozos. Downside is that property and restaurant prices seem quite high relative to other areas. Zacatecas, some way north, is larger though also attractive and shares the "silver city" heritage, and the overt culture is more obviously Mexican. I'd expect it to be a cheaper place to live with less obvious expat penetration and facilities. Equally with Guanajuato, though personally I'm quite happy to spend a day or two photographing there without feeling I want to spend a large chunk of my life there. The road traffic in Guanajuato is quite appalling. All these places are quite high altitude and when I've been there -in winter- the temperature has been very pleasant.

If it were me I'd start off with the Easy option at San Miguel and then in following years move elsewhere with your improved Spanish if you found the costs too high and wanted a more authentic Mexican lifestyle.