top of page
Modern House


What Is The Cost of Living In Michigan

After watching so many of my videos and reading my blog posts about the amazing state of Michigan, I bet there’s an itch to look more into moving to this fine state in much more detail? Or maybe not, and if that’s the case be sure to have some ointment prescribed for that itch you got. This video is structured around one question, how much does it cost to live in Michigan? Stick around, you’ll find out real quick.

What’s going on everyone, Andrew McManamon here, a licensed real estate professional in Michigan, and as I mentioned, I am going to go over how much it costs to live in Michigan. Before I dive into the averages and other comparisons, I want to break down a cost of living index provided by

This index is based on 100 being the U.S average. Overall, Michigan received an 89.6 on overall cost of living, 93.4 based on grocery, 86 based on healthcare, 65.5 based on housing, 100.1 based on utilities, 115.1 based on transportation, and 96.7 based on miscellaneous. There are of course a few notable scores on here that could be a little surprising, so let me break down why.


As you may or may not know, Michigan is the moodiest state of them all with its four seasons on any given day. With that in mind comes a very irregular heating and cooling bill every month. It’s either extremely hot or extremely cold, so we adjust our thermostats accordingly and that’s why the utilities are ranked higher than average.

If we are looking at the electricity usage, Michigan ranks somewhere in the higher middle section of the pack with an average usage of 16.07 cents per kilowatt hour. Just to put into perspective, Alaska averages 22 cents per kilowatt hour and Louisiana is about 9.37 cents.


Transportation in Michigan is 15.1 points above average mainly due to Michigan’s car insurance. Michigan car insurance is expensive because they have the highest minimum coverage requirement in the country. Michigan is also a no-fault state, which means drivers are required to purchase PIP or personal injury protection to pay for injuries after a crash, regardless of who was responsible.

The no-fault part isn’t the surprise, it’s the requirement for PIP. Most policy holders need at least $250,000 in coverage, and you can also buy unlimited. There are some exceptions though if you have Medicare or Medicaid. It’s important to get numerous quotes when you’re thinking about insurance, as it isn’t always one size fits all. Michigan also is ranked among the highest with most uninsured drivers, which makes sense when it’s an expense a lot of people can’t afford.


Michigan residents on average according to data collected by Ziprecruiter, make an average of $59,000 a year which works out to about $28 an hour. The nationwide average is about $66,600. In terms of miscellaneous, which takes account for food, entertainment, restaurants , repairs, clothing, and other services. You’ll see single adults spend about 12-13% a year on food, which is right around the average. There’s just so many different options for entertainment, food, clothing, and other types of services in Michigan, no wonder the score is so close to the national average.


What about education and healthcare? The University of Michigan for example offers great incentives for Michigan residents, whereas non-Michigan residents will pay 2-3x the amount for the same education according to SmartAsset. Michigan healthcare costs are slightly lower than other places in the U.S. With that in mind, the average employee contribution for single coverage health care is about a little lower than the national averages.


Stepping over to housing, nearly 70% of Michigan residents own their home, which is relatively high compared to average. Home appreciation in Michigan is up over 15.2% with the average age of homes being 47 years old. A lot of people ask me, so what’s the average home price in Michigan? And just like other states, it varies, especially with the pandemic altering the market as well.

Michigan averaged a home price point of around $185,000, but when the pandemic came around, the housing industry shutting down, seller and buyer hesitation, bidding wars, and everything else, the average grew to around $215,000. Like I said, it varies, you can look at Detroit’s average home price of around $50,000 that has since grown to the low to high 60’s, or take a look at Ann Arbor in the low to high 400’s.


So what about taxes? I did a few videos about property taxes in Michigan that I will link in the description in case you want to learn how to lower them or just want a basic understanding! Michigan has a flat income tax of 4.25%, but some cities add their own taxes on top of that, such as 6.65% in Detroit and other states are around 5.25%.

The state has a sales tax of 6% with no county or state taxes tacked on, which means the sales tax up in Marquette is the same as it is down here in Brighton. The current state gas tax is 26.3 cents per gallon. If 2021 inflation is 5% or more, then the fuel tax will be increased to 27.7 cents per gallon according to Michigan Capitol Confidential.


What about Michigan’s property tax? The average effective property tax in Michigan is 1.71% which is in the top highest in the country.

It’s safe to say there’s pros and cons to living in Michigan, just like there is living in any other state in the United states.



Andrew McManamon is a Michigan REALTOR® with Signature Sotheby’s International Realty and provides real estate services to Buyers, Sellers and Investors throughout SE Michigan including Livingston County, Oakland County, Washtenaw County, Genesee County & beyond. Andrew has become one of the rising stars of Michigan real estate agents. Prior to his real estate career Andrew was responsible for managing a senior living facility in Brighton, Michigan as a dining supervisor and an activities assistant. Andrew’s passion to help people is unlike any other, and he continues to strive to be best resource he can be. Andrew graduated from Cleary University in Howell, Michigan with a double major and currently resides in White Lake, Michigan.


bottom of page