A+
16%
Overall NAT. AVG.
2%
Goods & Services NAT. AVG.
53%
Housing NAT. AVG.
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Date & Last Updated: This data reflects 2023 and was released from C2ER in January, 2024; this is the most current data available.
The cost of living index is based on a national average of 100. For example, if the cost of living is 90, then it is 10% lower than average. If the cost of living is 110, then it is 10% higher than average. The breakdown for each index is as follows: goods & services (33%), groceries (13%), health care (5%), housing (30%), transportation (9%) and utilities (10%). If the cost of living data was unavailable for this city, estimates based upon nearby cities were used.
Index Detroit Michigan National
Cost of living8489100
Goods & Services10293100
Groceries10399100
Health care10293100
Housing4774100
Transportation10097100
Utilities94101100

An Overview of Cost of Living in Detroit, MI

Understanding the cost of living in Detroit can help future residents assess whether their current financial situation aligns with the expenses they will encounter. It enables them to plan for potential changes in their budget and lifestyle. The Detroit cost of living index is 84, which is 16% lower than the national average. The cost of living index is calculated by taking into account multiple categories, which encompass both the cost of everyday expenditures and larger expenses as well.

Housing costs often consume a significant share of your take-home income, often surpassing 30%. Fortunately, Detroit distinguishes itself by reporting housing expenses that are 53.2% below the national average. This indicates that both owning a home and renting in this area are notably more budget-friendly compared to the rest of the nation. With such favorable housing affordability, residents of Detroit can allocate more of their income to housing, enhancing their financial flexibility.

What Do Locals Say About the Cost of Living in Detroit?

The most insightful perspective on a city comes from its residents. We recently surveyed 49 locals to gauge their perception of the cost of living in Detroit. The feedback revealed that 69% of respondents found the cost of living to be reasonable, with prices on the decline, while 31% regarded it as notably expensive with prices that continue to rise.

Is Detroit Affordable?

Is Detroit an affordable place to live? It's a good question and one that you might want to ask when considering any new city, as affordability can play a huge role in the decision making process. The cost of living index (which we covered above), as well as housing costs and income levels play a vital role in determining the affordability of an area. The median home price in Detroit is 71.5% lower than the national average, while the average monthly rent prices are 10.4% lower than average. The affordability of any location can also be influenced by median income levels. Detroit has a median household income of $32,498, which is 41.3% lower than the national average.

What Factors can Influence the Cost of Living in Detroit?

Healthcare: Healthcare costs and insurance premiums can fluctuate greatly based on the city or state. Access to healthcare facilities, out-of-pocket expenses for doctor\’s visits, dentist costs, medication costs and specialized care costs can all impact the cost of living. In Detroit, the healthcare costs are 2.2% higher than the national average.

Utilities: Similar to the prices of any other goods or services, utility expenditures can exhibit substantial variability, influenced by factors such as climate, energy sources accessibility, geographical location and state regulations. Costs related to electricity, water, heating, and waste disposal can fluctuate, whether higher or lower, contingent on the city or state. In Detroit, the utilities index is 5.6% lower than the national average.

Taxes: Locations with elevated tax rates, encompassing both sales and income taxes, can be a factor in driving up the cost of living. When you're paying more in taxes for everyday goods and services, it naturally translates into higher expenses. Similarly, a higher income tax rate can also contribute to an overall higher cost of living. In Detroit, the standard sales tax rate starts at 6%, and the income tax rates commence at 4.25%.

Where is the Data From?

The cost of living in Detroit, presented above is derived from the C2ER cost of living index, offering a practical method for assessing living cost disparities in urban areas. Published quarterly, this index compiles data from more than 300 independent researchers, encompassing over 60 goods and services in 6 categories. The weightings assigned to cost variances are informed by government survey data tracking the expenditure patterns of professional and executive households. It should be noted that the C2ER index does not include data on sales or income tax rates, however, AreaVibes incorporates tax rates into the overall cost of living score for each area.

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Cost Of Living Quick Facts

  • The cost of living in Detroit is 5% lower than the Michigan average
  • The cost of living in Detroit is 16% lower than the national average
  • Detroit housing is 53% lower than the national average
  • Michigan general sales tax is 18% higher than the national average
  • Michigan state income tax is 88% higher than the national average

Most Affordable Places to Live in and Around Detroit

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Compare Detroit, MI Cost of Living

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      Salary Calculator

      This is how much you would need to earn in
      Price difference in compared to
      Cost of living index
      Goods & Services index
      Groceries index
      Health care index
      Housing index
      Transportation index
      Utilities index

      Median Income & Debt-To-Income Ratio

      Median Income Per Year Per Month Max Budget (28% DTI) Max Budget (36% DTI)
      Owners$42,885$3,574$1,001$1,287
      Renters$25,004$2,084$583$750
      The affordability of the housing market in Detroit, MI as well as the overall cost of living can be predicted by what percent of the monthly income is spent on housing related costs. This is konwn as the debt-to-income ratio (DTI). The overall rule of thumb is that no more than 28% of your gross income should be spent on the overall costs related to housing and no more than 36% of gross income on all expenses and debts. Among Detroit homeowners, the median income is $42,885. This indicates that a monthly maximum of $1,001 should be spent by homeowners on all housing related costs. Renters have a median income of $25,004. This indicates that renters would have a maximum of $583 for their rent related monthly costs.

      Michigan Sales Tax

      State General Sales Tax With Max Surtax
      Michigan 6% 6%

      Michigan Income Tax

      State Income Tax (Low) Income Tax (High)
      Michigan 4.25% 4.25%

      Goods & Services

      Item Detroit National avg. Difference
      Haircut $16.80$24.2630.8%
      Beauty Salon $24.78$45.5645.6%
      Toothpaste $3.66$3.701.1%
      Shampoo $1.13$1.2811.8%
      Movie $12.99$12.137.1%
      Bowling $12.33$18.0031.5%

      Groceries

      Item Detroit National avg. Difference
      Ground Beef $5.75$5.841.5%
      Fried Chicken $1.41$1.5710.4%
      Milk $4.78$4.672.3%
      Potatoes $4.80$4.932.8%
      Pizza $8.99$12.0925.6%
      Beer $9.04$10.4113.2%

      Health Care

      Item Detroit National avg. Difference
      Optometrist $85.00$125.6832.4%
      Doctor $103.33$135.7823.9%
      Dentist $91.00$113.2919.7%
      Ibuprofen $10.22$10.654.1%
      Lipitor $490.11$468.604.6%

      Housing

      Item Detroit National avg. Difference
      Home Price $52,700.00$184,700.0071.5%
      Avg. Mortgage Payment $1,709.07$2,346.6927.2%
      Apartment Rent $850.00$949.0010.4%

      Transportation

      Item Detroit National avg. Difference
      Gasoline $3.35$3.463.1%
      Tire Balancing $56.00$59.926.5%

      Utilities

      Item Detroit National avg. Difference
      All Electricity $219.20$193.9913.0%
      Phone $184.44$192.254.1%
      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 Population Cost of Living Index National Avg.
      River Rouge, MI7,4658019.9%
      Highland Park, MI10,8188218.3%
      Ecorse, MI9,4568316.8%
      Inkster, MI24,3988515.1%
      Hamtramck, MI21,7048614.3%
      Detroit, MI672,3518415.5%

      Cities with similar population

      City Population Cost of Living Index National Avg.
      Nashville, TN667,0701088.4%
      El Paso, TX679,8798910.6%
      Boston, MA689,32616665.5%
      Memphis, TN650,9108613.9%
      Portland, OR650,38013838.5%
      Detroit, MI672,3518415.5%
      Date & Last Updated: This data reflects 2023 and was released from C2ER in January, 2024; this is the most current data available.