Cost Of Living in Annapolis, MD

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F

37%

Overall NAT. AVG.

4%

Groceries NAT. AVG.

103%

Housing NAT. AVG.

Date & Last Updated: These cost of living estimates reflect 2026 modeled data using U.S. Census housing inputs and AI-assisted city-level pricing models.

The cost of living index is based on a national average of 100. For example, if the cost of living score is 90, then the estimated cost of living is 10% lower than the national average. If the score is 110, then the estimated cost of living is 10% higher than average. The overall index is calculated using weighted estimates across major everyday expense categories, including housing (30%), groceries (16%), transportation (12%), healthcare (10%), utilities (8%), lifestyle and entertainment (8%), household expenses (8%), and education and childcare (8%). All values are AI-assisted city-level estimates designed for directional comparisons.
Index	Annapolis	Maryland	National
Cost of living	137	121	100
Groceries	104	105	100
Health care	110	109	100
Housing	203	151	100
Transportation	110	109	100
Utilities	109	108	100
Lifestyle & Entertainment	108	109	100
Household Items	107	105	100
Education & Childcare	112	112	100

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Homes For Sale In Annapolis, MD

20 Washington Dr

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1022 Harbor Dr

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An Overview of Cost of Living in Annapolis, MD

Knowing the cost of living in Annapolis allows individuals to create a realistic budget. This helps them understand how their income will cover expenses and whether they need to make financial adjustments. The cost of living in any region can fluctuate due to various factors. To assess the cost of living consistently across different areas, a national average of 100 serves as the basis for the cost of living index. The cost of living in Annapolis stands at 137, marking it 37% higher than the national average.

If you prioritize affordability when seeking a new place to live, Annapolis may not be your ideal choice, as it ranks among the most expensive locations in the entire United States. A very small amount of areas exhibit a cost of living at least 20% higher than the national average, and unfortunately, Annapolis falls into this category, which may not align with your preferences for a budget-friendly living environment.

Housing costs make up a big chunk of the cost of living in Annapolis, and they usually eat into a large part of your take-home pay. Unfortunately, in this area, both buying a home and renting one costs 103.2% more than the average city. This includes stuff like home prices, rent, mortgage rates, and insurance.

Is Annapolis Affordable?

Is Annapolis affordable? It's a key consideration when pondering a move, as affordability often shapes your choices. The cost of living index (we discussed it earlier), coupled with housing costs and income levels, serves as the cornerstone for determining a location's affordability. Take Annapolis, for instance, where the median home price falls 123.2% higher than the national average, and monthly rent rates are 56.4% higher than usual. Additionally, median income levels contribute to the equation, with Annapolis flaunting a median household income of $132,521, 62.9% higher than the national norm.

What Factors can Influence the Cost of Living in Annapolis?

Groceries: Over the past 2-3 years, grocery expenses have experienced substantial upward trends. In certain markets, food prices have surged by over 20% during this period, while others have witnessed more modest increases. These fluctuations in food costs can wield significant influence over the overall cost of living in a given region. In Annapolis, the groceries index is 4% higher than the national average.

Transportation: In areas where public transportation is scarce or unavailable, residents often find themselves compelled to own and upkeep vehicles, thereby increasing the overall cost of living. Monthly expenses encompass fuel, insurance, routine maintenance and potentially lease or financing payments. In Annapolis, the transportation index is 9.8% higher than the national average.

Utilities: Similar to the prices of any goods or services, utility expenses can fluctuate widely, contingent on variables such as climate, available energy sources, geographical location and state regulations. Costs associated with electricity, water, heating, and waste disposal can differ in magnitude, depending on the specific city or state. In Annapolis, the utilities index registers at 8.8% higher than the national average.

Where is the Data From?

The Annapolis cost of living data displayed above uses a U.S. average baseline of 100 to provide a practical way to compare living expenses across cities. Housing estimates incorporate U.S. Census home price and rental data, while all other values are generated using AI-assisted models based on everyday expense expectations, regional pricing trends, climate, transportation patterns, and local economic conditions. These values are designed for directional city-to-city comparisons.

Cost Of Living Quick Facts

The cost of living in Annapolis is 13% higher than the Maryland average
The cost of living in Annapolis is 37% higher than the national average
Annapolis housing is 103% higher than the national average
Maryland general sales tax is 18% higher than the national average
Maryland state income tax is 23% lower than the national average

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Price difference in compared to

Cost of living index
Groceries index
Health care index
Housing index
Transportation index
Utilities index
Lifestyle index
Household index
Educare index

Median Income & Debt-To-Income Ratio

Median Income	Per Year	Per Month	Max Budget (28% DTI)	Max Budget (36% DTI)
Owners	$180,767	$15,064	$4,218	$5,424
Renters	$78,488	$6,541	$1,831	$2,355

A good indicator of the general affordability of housing in Annapolis, MD, is the percentage of monthly income that should be spent on housing expenses, otherwise known as the debt-to-income ratio (DTI). Generally speaking, no more than 28 percent of your total gross income should be spent on your housing expenses and not more than 36 percent of your gross income on total expenses, including debts. In Annapolis, the median monthly income is $180,767 for those who own their own homes. Under the standard rule, that income level would allow for $4,218 to be budgeted for housing expenses each month, at the most. Renters, on the other hand, earn about $78,488, per the median income in the area. That would allow for renters to spend up to $1,831 on monthly rental expenses.

Maryland Sales Tax

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

Maryland Income Tax

State	Income Tax (Low)	Income Tax (High)
Maryland	2%	5.75%

Nearby cities with low cost of living

City	Population	Cost of Living Index	National Avg.
Rock Hall, MD	1,594	105	5.3%
Ferndale, MD	18,230	119	19.2%
Glen Burnie, MD	71,246	119	19.4%
Upper Marlboro, MD	601	118	18.2%
Riviera Beach, MD	13,245	123	23.2%
Annapolis, MD	40,873	137	36.6%

Cities with similar population

City	Population	Cost of Living Index	National Avg.
Los Banos, CA	40,884	128	27.6%
Columbia, TN	40,814	96	3.6%
Hagerstown, MD	40,940	101	1.3%
Keizer, OR	40,787	117	16.8%
Friendswood, TX	40,785	116	16.3%
Annapolis, MD	40,873	137	36.6%

Date & Last Updated: These cost of living estimates reflect 2026 modeled data using U.S. Census housing inputs and AI-assisted city-level pricing models.