Ann Arbor cost of living index

In the event that the cost of living data was unavailable for this city, estimates based upon nearby cities were used. Each cost of living index is based on a national average of 100. If the amount is below 100, it is lower than the national average. If the amount is above 100, it is higher than the national average.
IndexAnn ArborMichiganNational
Cost of living index10889100
IndexAnn ArborMichiganNational
Goods & Services index9594100
Groceries index11094100
Health care index125100100
Housing index12673100
Transportation index99101100
Utilities index9496100
Here we can see a simple outline of the cost of living in Ann Arbor, MI. As you can see, with the average cost of living in Ann Arbor, MI being 108, that puts it 21% higher than the average of Michigan and 8% higher than our nation's average. This simple outline of the cost of living index was formulated using prices of: goods and services (weighted 33%), housing prices (weighted 30%), groceries (weighted 13%), utilities (weighted 10%), transportation (weighted 9%), and health care (weighted 5%). Thus, goods/services, along with housing influences the majority of the cost of living index. The price of daily goods and services is a valuable and reliable number to be aware of when considering the general price of the city's goods. In the case of Ann Arbor, MI, the price of goods and services are 1% higher than the average of Michigan as well as 5% lower than the nation's average.

Did you know?

  • The cost of living in Ann Arbor is 21% higher than the Michigan average.
  • The cost of living in Ann Arbor is 8% higher than the national average.
  • The cost of housing in Ann Arbor is 26% higher than the national average.
  • Michigan general sales tax is 18% higher than the national average.
  • Michigan state income tax is 91% higher than the national average.

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Salary Calculator

This is how much you would need to earn in
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Cost of living index
Goods & Services index
Groceries index
Health care index
Housing index
Transportation index
Utilities index
The salary calculator is used in order to provide a comparison of your current salary in Ann Arbor, MI to another city of your choice. The calculator will inform you of what your salary needs to be in any specific city in order for you to maintain your living standard based on what the city’s cost of living is. As an example, if you are seeking to move to a city that has a higher cost of living compared to Ann Arbor, MI, you would have to earn a higher income to maintain a standard of living that is similar. To get started with the Ann Arbor, MI salary calculator, input the new city’s name and then move the slider to indicate your current income. The salary calculator will now process the numbers and show you whether you need to earn more or less in the chosen city. A comprehensive breakdown of the cost of living will also be shown.

Median Income & Debt-To-Income Ratio

Median IncomePer YearPer MonthMax Budget (28% DTI)Max Budget (36% DTI)
Owners$96,843$8,070$2,260$2,906
Renters$35,161$2,930$820$1,055
One can approximate the cost of living and the housing affordability in Ann Arbor, MI by the percentage of a person’s income that he or she spends on the monthly housing, otherwise known as the debt-to-income ratio (DTI). To stay on the safe side and keep one’s head above the water, a consumer should never spend more than 28 percent of his or her gross income on housing-related expenses and costs and not more than 36 percent of income on all expenses and debts. Homeowners in Ann Arbor, MI have a median income of $96,843. Therefore, the amount that a consumer should spend on housing costs should be no more than $2,260 per month to avoid calamity and poverty. The renters in the city have an income of about $35,161, which would make their monthly maximum allowable rental costs $820.

Michigan Sales Tax

StateGeneral Sales TaxWith Max Surtax
Michigan6%6%

Michigan Income Tax

StateIncome Tax (Low)Income Tax (High)
Michigan4.25%4.25%
The Michigan sales tax and Michigan income tax rates should definitely be considered when determining the overall cost of living in Ann Arbor, MI. Sales taxes are taxes that are imposed onto goods and services sold. Sales taxes do vary by state and can range from no tax at all to upwards of 7%. The Michigan sales tax is 6% and the maximum surtax is 6%. Income tax is the tax imposed on income by the government. The income tax rates will vary by state and will also increase or decrease depending on the corresponding tax bracket. State income tax rates can range from anywhere from no tax at all to more than 9%. The Michigan income tax rates range from 4.25% to 4.25%.

Goods & Services

ItemAnn ArborNational avg.Difference
Haircut $14.18$15.568.9%
Beauty Salon $46.84$36.1129.7%
Toothpaste $2.53$2.472.5%
Shampoo $1.12$0.9616.0%
Movie $12.29$10.1321.4%
Bowling $4.17$4.7412.0%

Groceries

ItemAnn ArborNational avg.Difference
Ground Beef $4.22$3.985.8%
Fried Chicken $2.24$1.4159.1%
Milk $2.11$2.062.5%
Potatoes $2.58$2.9813.4%
Pizza $9.62$9.471.6%
Beer $8.70$8.791.1%

Health Care

ItemAnn ArborNational avg.Difference
Optometrist $100.12$101.040.9%
Doctor $156.76$107.4445.9%
Dentist $121.27$90.4234.1%
Ibuprofen $8.49$9.288.6%
Lipitor $445.93$426.504.6%

Housing

ItemAnn ArborNational avg.Difference
Home Price $231,700.00$175,700.0031.9%
Avg. Mortgage Payment $1,367.76$1,133.2320.7%
Apartment Rent $1,042.00$920.0013.3%

Transportation

ItemAnn ArborNational avg.Difference
Gasoline $1.98$1.990.5%
Tire Balancing $44.07$45.763.7%

Utilities

ItemAnn ArborNational avg.Difference
All Electricity$181.88$163.8111.0%
Phone $20.05$28.3929.4%
Although the cost of living data is updated regularly, this cost of living information is to be used as estimates only as prices can change on an ongoing basis.

Nearby cities with low cost of living

City, StatePopulationCost of Living IndexNational Avg.
Belleville, MI3,91488-12%
Clinton, MI2,22989-11%
Ypsilanti, MI19,84491-9%
Milan, MI5,72493-7%
Whitmore Lake, MI6,38093-7%
Ann Arbor, MI115,9851088%

Cities with similar population

City, StatePopulationCost of Living IndexNational Avg.
Peoria, IL115,71890-10%
Berkeley, CA115,68818282%
Norman, OK115,52189-11%
El Monte, CA115,24313131%
Springfield, IL116,81587-13%
Ann Arbor, MI115,9851088%
Source: The Ann Arbor, MI cost of living data displayed above is derived from the Council for Community and Economic Research (C2ER) for the fourth quarter of 2016.