Ann Arbor, Michigan Cost Of Living

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Overall 11%

Goods & Services 6%

Housing 30%

Date & Last Updated: This data reflects 2022 and was released from C2ER in January, 2022; 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	Ann Arbor	Michigan	National
Cost of living	111	89	100
Goods & Services	106	94	100
Groceries	102	91	100
Health care	96	95	100
Housing	130	74	100
Transportation	106	102	100
Utilities	99	102	100

Key findings

The cost of living in Ann Arbor is 25% higher than the Michigan average
The cost of living in Ann Arbor is 11% higher than the national average
Ann Arbor housing is 30% higher than the national average
Michigan general sales tax is 18% higher than the national average
Michigan state income tax is 72% higher than the national average

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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	$100,449	$8,371	$2,344	$3,014
Renters	$35,243	$2,937	$822	$1,057

To approximate the cost of living and the housing affordability in Ann Arbor, MI, we can look at the percentage of income that is available to be spent on monthly housing, otherwise known as the debt-to-income ratio (DTI). To stay on the safe side, a consumer should not spend more than 28% of his or her gross income on housing-related expenses and costs and not more than 36% of income on all expenses and debts. Homeowners in Ann Arbor have a median income of $100,449. Therefore, the amount that a consumer should spend on housing costs should be no more than $2,344 per month to avoid calamity and poverty. The renters in the city have an income of about $35,243, which would make their monthly maximum allowable rental costs $822.

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	Ann Arbor	National avg.	Difference
Haircut	$19.53	$20.27	3.6%
Beauty Salon	$54.83	$40.39	35.7%
Toothpaste	$2.86	$2.36	21.1%
Shampoo	$0.96	$1.08	10.8%
Movie	$10.98	$10.99	0.0%
Bowling	$19.73	$15.49	27.4%

Groceries

Item	Ann Arbor	National avg.	Difference
Ground Beef	$4.52	$4.30	5.1%
Fried Chicken	$1.31	$1.40	6.4%
Milk	$1.53	$2.20	30.4%
Potatoes	$4.58	$3.22	42.2%
Pizza	$10.99	$10.74	2.3%
Beer	$8.74	$9.60	8.9%

Health Care

Item	Ann Arbor	National avg.	Difference
Optometrist	$83.30	$109.73	24.1%
Doctor	$107.85	$118.34	8.9%
Dentist	$102.97	$100.94	2.0%
Ibuprofen	$9.06	$9.93	8.8%
Lipitor	$497.03	$469.53	5.9%

Housing

Item	Ann Arbor	National avg.	Difference
Home Price	$250,200.00	$184,700.00	35.5%
Avg. Mortgage Payment	$1,261.54	$1,229.62	2.6%
Apartment Rent	$1,114.00	$949.00	17.4%

Transportation

Item	Ann Arbor	National avg.	Difference
Gasoline	$2.71	$2.71	0.0%
Tire Balancing	$60.60	$51.86	16.8%

Utilities

Item	Ann Arbor	National avg.	Difference
All Electricity	$169.73	$170.84	0.7%
Phone	$182.37	$187.18	2.6%

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.
Clinton, MI	2,495	92	7.9%
Belleville, MI	3,896	93	6.7%
Ypsilanti, MI	20,577	95	5.4%
Milan, MI	5,917	97	3.1%
Pinckney, MI	2,590	97	3.0%
Ann Arbor, MI	118,087	111	11.5%

Cities with similar population

City	Population	Cost of Living Index	National Avg.
Waterloo, ON	118,234	n/a
Beaumont, TX	117,729	87	13.5%
Berkeley, CA	118,585	192	91.9%
Independence, MO	117,217	83	16.9%
Norman, OK	118,974	91	9.3%
Ann Arbor, MI	118,087	111	11.5%

Source: This data reflects 2021 and was released from C2ER in January, 2022; this is the most current data available.