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What Ann Arbor Actually Costs: An Out-of-State Relocator's Guide

The line items nobody warns you about.

Published April 21, 2026·Reviewed April 21, 2026·8 min read

The bottom line

Ann Arbor is expensive for Michigan and reasonable for a university town of its quality. If you are moving from California, New York, or Boston, it will feel like a raise. If you are moving from Ohio, Indiana, or most of the South, it will feel like a premium.

The shocks are rarely in the mortgage payment. They are in property taxes, auto insurance, and winter operating costs. Budget those explicitly.

Housing

Entry-level single-family houses exist in Water Hill, parts of the Old West Side, Eberwhite, Lansdowne, and Pittsfield Village. Expect smaller square footage than the same price in most of the country.

Mid-range family homes cluster in Burns Park, Bryant, Scio Hills, Stonebridge, and the Polo Fields. The Ann Arbor tax premium is real at this tier.

Higher-end inventory lives in Ann Arbor Hills, Barton Hills, Lake Forest, Silverleaf, and Forestbrooke. Inventory is thin. Good listings go fast even in slower markets.

Condos near downtown, in Kerrytown, and along the Huron River corridor can be a real entry point for single buyers and downsizers.

Property taxes

Michigan property taxes are higher than most out-of-state buyers expect. Ann Arbor carries both a city millage and a strong school millage. The combination puts Ann Arbor among the higher tax burdens in the state.

Michigan uses a homestead versus non-homestead distinction. When you buy, the first tax bill may arrive at the non-homestead rate until you file a Principal Residence Exemption. File immediately after closing.

Property taxes in neighboring townships can be meaningfully lower. Lodi Township, Scio Township, and Webster Township often carry lighter tax bills than the city proper. Schools, services, and trash pickup vary accordingly.

Auto insurance after PIP reform

Michigan overhauled auto insurance with PIP reform. Drivers now choose their Personal Injury Protection coverage level. Unlimited PIP is still available. Lower tiers are too, and they change the premium significantly.

Out-of-state drivers frequently default to unlimited PIP without thinking about it. If you already have strong health insurance through an employer, a lower PIP tier is often the right call. Talk to a local broker, not the 1-800 number of your old carrier.

Auto rates in Washtenaw County are lower than Wayne County but higher than most of the South and Midwest. Build that into the monthly budget before you pick a second car.

Winter costs

Heating from November through March is a real line item. Older houses on the Old West Side and in Burns Park can have steep gas bills. Newer builds in Stonebridge or Silverleaf are tighter envelopes.

Snow removal is either labor or equipment. A snowblower is a one-time expense. A contract with a plow service is monthly from December to March. If you travel in winter, a contract is worth the peace of mind.

Winter tires are a serious safety upgrade, not a luxury. A second set of wheels with dedicated snow tires pays for itself in one avoided accident.

Budget for a winter coat that actually works, for every person in the house. A Midwest winter is not a coastal winter.

Utilities and internet

DTE Energy provides most electric and gas service in and around Ann Arbor. Rates are state-regulated and published.

Internet options vary by block. Fiber is widespread in much of the city but not universal. Check service availability at the specific address before you sign.

Water and sewer inside the city are billed by the city and are not trivial. Townships often run on wells and septic, which shift the cost model entirely.

Groceries and day-to-day

Kroger on Maple Rd and on Washtenaw Ave handles the main weekly shop for most households. Meijer on Ann Arbor-Saline Rd is the cheaper full-stock option. Busch's and Plum Market anchor the mid-to-higher tier.

Zingerman's Delicatessen on Detroit St is a regional destination, not a weekly grocery. Zingerman's Bakehouse on Plaza Dr is the bread source. Argus Farm Stop on Liberty St and on Packard St sells from local farms and is where a lot of households do meat, eggs, and produce in season.

The Kerrytown Farmers Market runs Saturday mornings. It is a real market, not a tourist event. Prices are reasonable once you learn the stalls.

The gotchas

City income tax is a thing in parts of Michigan, but not in Ann Arbor. Pleasant surprise for transplants from Columbus, Cincinnati, or New York City.

Home football Saturdays move the whole city. Restaurants, grocery runs, and even errands get routed around the schedule from early September through late November.

Art Fair in July is the week to leave town or embrace it. Downtown becomes uncrossable for three days.

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