Homeowners Insurance

Most and Least Affordable Cities in Michigan for Homeowners & Renters

The affordability of housing costs for homeowners and renters in Michigan varies significantly based on the city in which you live. The cities of Southfield and Flint are some of the least affordable cities to live in, while Troy is the most affordable for owners and renters.

How do we determine which cities are and are not affordable? The standard of home affordability compares income to housing costs, including mortgage or rent payments, homeowners insurance, and utilities. If these expenses exceed 30% of a person's income, they are considered burdened by their housing costs. We took this information and analyzed the top 20 Michigan cities in terms of population, diving deep into homeowner and renter housing costs.

Housing costs for homeowners did not exceed 20% of the median income in any of the major cities and according to the standard for home affordability threshold, all cities are therefore affordable. Southfield took the title for the least affordable city, as homeowners pay the highest percentage of their incomes toward housing costs: 19.73%, or $14,328 annually.

One city that ranked as least affordable for renters and owners alike was Flint.

Flint's renters earned a median income of $16,613 and paid, on average, $8,364 for housing annually. That means more than 50% of their income goes toward housing costs, which is the highest percentage in the state. Flint was ranked third as least affordable for homeowners, with an 18.65% of their income dedicated to housing. Notably, Flint was also the second most expensive city for homeowners insurance in the state.

We also explored the most and least affordable college cities in Michigan. Big Rapids was the most affordable for homeowners and Rochester Hills for renters. The least affordable college town was Ypsilanti for homeowners and Houghton for renters.

Most and Least Affordable Cities for Homeowners in Michigan

Our analysis determined Troy is the most affordable city for homeowners in Michigan. The annual median income for homeowners in Troy was the highest across the cities we analyzed, at $106,459. However, only 15.61% of income or $16,620, was spent on housing annually. Following Troy ranked Livonia and Farmington Hills, in contention for most affordable city in Michigan.

Affordability of Michigan Cities for Homeowners

Most and Least Affordable Cities for Renters in Michigan

The top five most affordable cities in Michigan for renters are all situated in an approximate 25 mile radius around Detroit, with Troy being the most affordable. Renters in Troy spend 21.15% of their incomes on housing costs. Of the top five cities, Sterling Heights actually had the lowest monthly housing cost of $949 monthly or $11,388 annually, but due to a lower median income for renters, 26.75% of their income is spent on housing.

The least affordable cities for renters are distributed around the state, with Flint having the highest housing costs compared to annual income. Detroit and its nearby suburb Dearborn are also expensive for renters. Housing costs in both cities exceed 40% of the annual income for residents.

Affordability of Michigan Cities for Renters

Affordability of Homeownership in Michigan

Housing costs include mortgage payments or rent; utilities such as electricity, gas and water; property taxes; and homeowners insurance, which may include flood insurance. Most of the cities in Michigan that we analyzed were cheaper for renters than homeowners, simply by comparing the median monthly housing costs.

Interestingly enough, it's cheaper to own rather than rent in four cities: Flint, Detroit, Dearborn and Warren.

Cities in Michigan Where Homeowners Pay Less on Housing than Renters

By the standard for home affordability measure, all major cities in Michigan are affordable for the typical homeowner. In contrast, only 30% of the major cities, or six of the 20 analyzed, are affordable to the typical renter.

Affordability of College Cities in Michigan

The Wolverine State has several major college towns, so which ones are most affordable as owners and renters?

Big Rapids was the most affordable city for homeowners, and Ypsilanti was the least affordable.

Most and Least Affordable College Cities in Michigan for Homeowners

However, this does not hold true for renters. The most affordable option for renters is Rochester Hills, as residents paid only 27.43% of their incomes toward housing. Even though monthly housing costs are highest for renters, the median income was double most of the other college towns we analyzed. Because of these reasons, Rochester Hills is the most affordable housing option for renters.

Most and Least Affordable College Cities in Michigan for Renters

Houghton is least affordable for renters, as 50.97% of their incomes go toward housing costs annually. However, homeowners in Houghton only pay 16.42% of their income toward housing, and Houghton is ranked the fifth cheapest city in Michigan for home insurance.

The University of Michigan, located in the largest college town of Ann Arbor, had one of the more affordable options for renters compared to other college towns across the state. Renters paid only 34.79% of their income toward housing costs annually.

Methodology

We analyzed population and housing cost data from the Census Bureau's American FactFinder database. The 20 major Michigan cities included in our analysis have a population of more than 70,000 as of the 2010 Census.

More information pertaining to Standard Home Affordability can be found here.

CityAnnual homeowner incomeHomeowner housing costsHomeowner affordabilityAnnual renter incomeRenter housing costsRenter affordability
Ann Arbor*$102,721$1,41116.48%$40,222$1,16634.79%
Big Rapids*$58,005$66813.82%$15,712$57744.07%
Canton Charter Township$102,623$1,46517.13%$52,644$1,09324.91%
Clinton Charter Township$64,002$95317.87%$33,492$88531.71%
Dearborn$62,993$94017.91%$28,091$1,00342.85%
Detroit$39,773$58617.68%$19,247$77348.19%
East Lansing*$102,048$1,31415.45%$23,725$92946.99%
Farmington Hills$100,433$1,36816.35%$49,340$1,12527.36%
Flint$36,152$56218.65%$16,613$69750.35%
Grand Rapids$60,238$86217.17%$28,267$85436.25%
Houghton*$66,354$90816.42%$16,975$72150.97%
Ingham$67,586$96517.13%$30,279$84133.33%
Kalamazoo*$58,698$82316.83%$26,451$74333.71%
Lansing$50,693$80218.98%$27,176$79134.93%
Livonia$80,691$1,08816.18%$42,400$1,03129.18%
Macomb Township$69,177$98117.02%$34,938$91631.46%
Marquette*$63,770$88016.56%$24,350$71535.24%
Mount Pleasant*$65,318$83915.41%$22,726$73939.02%
Rochester Hills*$101,780$1,35615.99%$52,445$1,19927.43%
Shelby Charter Township$81,004$1,13916.87%$38,961$97630.06%
Southfield$72,604$1,19419.73%$38,602$1,04532.49%
Sterling Heights$70,780$1,02217.33%$42,565$94926.75%
Troy$106,459$1,38515.61%$62,981$1,11021.15%
Warren$53,021$78117.68%$28,887$88136.60%
Westland$58,932$91218.57%$33,118$84130.47%
Wyoming$61,242$88417.32%$31,635$78929.93%
Ypsilanti*$73,679$1,11218.11%$25,258$78137.11%
Housing costs represent the median amount spent per month. Affordability is determined by comparing annual housing costs and income. * Represents cities included in college town analysis
Callie McGill

Callie is a Content Marketing Research Analyst at ValuePenguin, with a focus on insurance.

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.