Cost of Living in Detroit Michigan: A Homebuyers' Guide to Detroit Living Expenses

Cityscape of downtown Detroit along the river near new construction homes in Detroit, Michigan
Cityscape of downtown Detroit along the river near new construction homes in Detroit, Michigan

If you’re considering a move to the Motor City, you may be curious about the average cost of living in Detroit, Michigan. The Motor City is a diverse melting pot of people and culture, with a unique history and plenty of opportunities for fun, making it an appealing location. In this guide, we break down the city’s living expenses, from housing and transportation to groceries and recreation, to help you decide if the Detroit, MI, cost of living fits your lifestyle and budget. 


Summary:

  • Cost of Living in Detroit, MI

  • Comparing Average Home Prices and Rent Costs in Detroit, MI

  • Other Living Expenses in Detroit, MI

    • Grocery Shopping and Dining Out in Detroit

    • Transportation Options and Fuel Costs in Detroit

    • Healthcare and Insurance Costs in Detroit

    • Utilities, Internet, and Phone Expenses in Detroit

    • Tax Rates in the Detroit Area

    • Recreation Costs in Detroit, Michigan

  • Average Salary in Detroit, MI

  • Potential Tax Benefits for Homeowners in Detroit, MI

  • Average Cost of New Construction Homes in Detroit, MI, by Neighborhood

  • Conclusion


Cost of Living in Detroit, MI

While living expenses in Detroit, Michigan, have increased slightly over the past year, per Salary.com® as of May 2024, the city and surrounding suburbs still offer a range of options for affordable living. Compared to the national average, Salary.com finds the cost of living in Detroit, MI, to be 2.7% lower. 


Now, let’s dive into some of these essential living expenses and why you should consider them when considering renting or buying a new home in Detroit, Michigan. 


Comparing Average Home Prices and Rent Costs in Detroit, MI

According to the March 2024 data from Payscale®, the Detroit, Michigan cost of living for housing is 8% higher than the national average, with the median home price around $486K and the median monthly rent averaging $1,479. This price can depend on the neighborhood and building type, with high-rise apartment complexes typically being more expensive due to the included amenities and proximity to conveniences. 


As of June 2023, Redfin® finds a typical home in Metro Detroit is 24% less expensive to purchase than renting an apartment or townhome in the city, with a median monthly mortgage payment averaging $1,296. 


Other Living Expenses in Detroit, MI

While rent or mortgage payments may take up the bulk of your expenses, there are many other costs to consider when moving to Detroit. Whether it’s your weekly groceries or utility payments, these added expenses all factor into your overall average cost of living in Detroit, Michigan.


Grocery Shopping and Dining Out in Detroit

From Whole Foods® to the vendors at Eastern Market, Detroit offers both budget-conscious and premium options for grocery items. Overall, Payscale data states that food costs in Detroit are 1% higher than the national average as of March 2024 and offers a breakdown of the average cost of everyday groceries found in Detroit stores: 


  • Bread: $3.92/loaf

  • Milk: $2.46/gallon

  • Eggs: $2.27/carton

  • Bananas: $3.40/bunch


As for dining out, while Detroit is primarily known for Motown music and car manufacturers, it’s also popular for its iconic culinary scene, from the infamous square pizza to the humble slider. Whether you’re seeking fine dining or takeout, Detroit offers a wide range of cuisines and budget-friendly venues. 


According to Numbeo®, as of June 2024, the average cost of a meal for one person at an inexpensive restaurant is around $17. At a mid-range restaurant, you can expect a meal for two to cost roughly $78 for three courses. 


Transportation Options and Fuel Costs in Detroit

As of 2024, the Detroit Department of Transportation (DDOT) serves approximately 85,000 riders daily, per the City of Detroit website, so there’s no shortage of options for getting around the Motor City. Offering passage throughout the 139 square miles of downtown Detroit and suburban outskirts, these options are reliable, accessible, and, most importantly, affordable. 


ADA-accessible DDOT bus fares are $2 for a four-hour pass and $5 for a 24-hour pass. SMART local and cross-county buses run from $2–$8, depending on how far you need to travel. You can also try the QLINE or the Detroit People Mover, both of which are free but have a more limited service range. 


Additionally, many tourists in Detroit use transportation services like MoGo® (short-term bike rentals), scooters, rideshare apps, and even Amtrak®. 


For long-term residents, using a personal car is a popular option, and according to AAA®, a gallon of regular gas averages $3.59 as of June 2024.


Healthcare and Insurance Costs in Detroit

As of March 2024, Payscale finds health care in Detroit to be 1% less than the national average and shares examples of standard medical expenses, although these costs can vary depending on your provider and insurance plan:


  • Doctor appointment: $123. 66

  • Dentist: $106.69 

  • Optometrist: $116.48

  • Prescription: $455.63 

  • Veterinarian: $63.39 


For health insurance costs, MoneyGeek® finds the average monthly premium for health insurance is around $350 as of May 2024.
A woman adjusts the thermostat, reflecting the cost of living in Detroit, Michigan, for utilities
A woman adjusts the thermostat, reflecting the cost of living in Detroit, Michigan, for utilities

Utilities, Internet, and Phone Expenses in Detroit

Whether you own a home or rent, utility expenses typically factor into the cost of living in Detroit suburbs and beyond. From phone bills to your energy costs, utilities include all the basic services you need for your home. 


According to March 2024 data from Payscale, utility expenses are 2% less than the national average, with monthly energy bills in Detroit around $173.81 and phone bills approximately $186.99. USA Today® reports monthly internet fees range from $20–$55 as of March 2024, depending on the service provider.


Tax Rates in the Detroit Area

When moving to a new city or state, taxes are an important consideration. Here’s a breakdown of the average tax costs you can expect in Detroit, Michigan: 


  • Income tax: Per the City of Detroit in March 2024, residents pay an income tax rate of 2.50%, and nonresidents pay 1.25%.


  • Property tax: According to Axios®, Detroit’s 2022 property tax rate was 3.21% for a median-valued home. 


  • Sales tax: The Michigan state sales tax is 6%, according to the State of Michigan. 


Recreation Costs in Detroit, Michigan

The city of Detroit offers a range of recreation centers across each district, offering everyone access to the activities available. While costs and activities per center may vary, it’s a great way to stay active and meet members of your community at an affordable price. 


For example, in 2023, A.B. Ford Park® opened a brand-new community center with stunning views of the east Detroit riverfront and several sports fields and courts, fitness equipment, outdoor trails, and much more. As of September 2024, membership fees for the community center are $2 for toddlers, $7 for children aged 6–12, $10 for teens and seniors, and $20 for adults. 


For other fun activities around Detroit, prices vary based on the amenity or attraction. General admission tickets to the Detroit Zoo run approximately $23. Numbeo finds monthly gym memberships average $53.75, and a movie ticket for one person is $12 as of June 2024. 


Average Salary in Detroit, MI

Detroit is a hub for new and seasoned entrepreneurs and offers proximity to numerous major employers from a variety of industries. According to ZipRecruiter®, as of June 2024, the average annual salary in Detroit is $80,925, or roughly $39 per hour. Overall, salaries can range from $32K to $109K, depending on the position, industry, and other factors. 


Potential Tax Benefits for Homeowners in Detroit, MI

Owning a home in Detroit can often open the door to potential tax benefits, helping make homeownership more cost-efficient in the long run. Here’s a brief overview of some potential tax benefits you could be eligible for if you buy a home in Detroit:


  • Property tax and mortgage interest deductions: Homeowners may be able to deduct part of their property taxes from their primary home as well as their mortgage interest.  


  • Energy-efficient home improvement tax credits: Homeowners who make qualified improvements to their house to boost energy efficiency may be eligible for up to $3,200 in a tax credit.


  • First-time Home Buyer Savings Program: Launched in 2022, this program allows eligible participants to open and contribute to a first-time home buyer savings account. All qualified contributions, interest, and withdrawals are tax-exempt through December 31, 2026. 


  • Homestead Property Tax Credit: This tax credit can help eligible homeowners potentially lower their property tax bill or receive a refund.  


  • Homeowners Property Exemption (HOPE): This program grants a full (100%) or partial (50%) exemption from property taxes depending on the applicant's specific income requirements. Each applicant must own and occupy the property and be the primary homestead to be eligible. 
Exterior of a new construction home, an example of living expenses in Detroit, Michigan
Exterior of a new construction home, an example of living expenses in Detroit, Michigan

Average Cost of New Construction Homes in Detroit, MI, by Neighborhood

Building a home from the ground up can be an exciting journey, and the cost can depend on the square footage, lot size, and many other factors. According to HomeGuide®, as of March 2024, the average cost to build a new home in Michigan can range from $234K to $396K. 


Let’s take a look at the average cost of new construction homes in Detroit, MI, neighborhoods. 


Shelby Township

Shelby Township is a community-oriented town with year-round events for all ages, a range of entertainment options, and plenty of opportunities for shopping and dining, helping make it a great location for any homebuyer. The area is also known for being home to over 100 species of native birds and animals, and with proximity to Stony Creek Metropark and St. Clair Shores, this neighborhood is ideal for those who enjoy the outdoors. 


As of June 2024, NewHomeSource™ finds that the average cost of a new construction home in Shelby Township ranges from the mid $400Ks to the mid $800Ks. Explore Pulte® new construction homes in Shelby Township, MI, starting in the mid $400Ks in lovely communities like The Village at Beacon Pointe. 


Clarkston 

For peaceful living, Clarkston is the place to call home. Though it has a population of less than one thousand people, this quaint city still offers an abundance of community events and activities. Local shops and restaurants line the downtown streets, and with centers like DTE Energy Music Theatre nearby, there are always exciting events around town. Clarkston residents enjoy the close-knit community feel alongside the area’s comfort and convenience. 


According to NewHomeSource, as of June 2024, the average cost of a new construction home in Clarkston ranges from high $300Ks to the mid $600Ks. Browse our new construction homes in Clarkston, MI, starting in the upper $300Ks. 


Commerce Township 

With scenic views and surrounded by local lakes, Commerce Township offers a beautiful suburb oasis away from the hustle and bustle of big-city life. Offering a quality school system and plenty of outdoor recreational activities, Commerce Township has it all. 


As of June 2024, NewHomeSource reports the average cost for a new construction home in Commerce Twp ranges from mid $400Ks to mid $600Ks. Check out our new construction homes in Commerce Township, MI, starting in the mid $400Ks. 


Macomb Township 

Macomb Township prides itself on being a hub for business and education. Plus, the area offers affordable housing, proximity to premier healthcare facilities, and an array of world-class dining and shops, all the essentials that help make Macomb a place to thrive. 


For a new construction home in Macomb Township, NewHomeSource finds the average starting price begins in the lower $300Ks as of March 2024. Explore new construction homes in Macomb Township, MI, from Pulte, starting in the upper $400Ks. 


Lyon Township

One of the fastest-growing communities in Southeast Michigan, Lyon Township boasts a historic charm, an abundance of recreational assets, and quality school systems. From the popular Lyon Township Kite Festival to concerts in the park, you’ll find annual community events for all ages and interests. Offering convenient access to major highways like I-96, US-23, and I-275, Lyon Township is a great place for commuters and a well-rounded community that continues to grow. 


According to NewHomeSource, the average cost of a new construction home in Lyon Township ranges from mid $300Ks to the mid $700Ks as of March 2024. View our new construction homes in Lyon Township, MI, starting in the upper $500Ks. 


Conclusion

Due in part to its rich culture and affordable cost of living, Detroit, Michigan, appeals to a diverse group of people. From the vibrant, historic downtown city streets to the serene suburbs along the outskirts, there are so many wonderful areas to call home in the Motor City. Now that you have a better understanding of living expenses in Detroit, Michigan, you can consider a move to this dynamic city and find a home that’s just right for you, your budget, and your lifestyle.  


Explore new construction homes in Detroit, MI, today or browse more Pulte blogs. 



Written By: Bella Biafore, Michigan Resident and Marketing Coordinator of Pulte Homes Michigan Division

Last Updated: November 19, 2024