Is it cheaper to live in Ann Arbor or Salem?

Salem, OR is cheaper. Its monthly baseline of $1,170 (1BR rent + utilities) runs about 28% below Ann Arbor, MI's $1,630, mainly because of rent.

How much more do you need to earn to live in Ann Arbor than in Salem?

To keep rent near the recommended 30% of gross income, you'd want to earn roughly $56,000 a year in Ann Arbor versus $40,000 in Salem.

Which has lower taxes, Ann Arbor or Salem?

Ann Arbor is taxed under Michigan's rules (a top state income tax rate of 4.25% and a 6% state sales tax); Salem under Oregon's (a top state income tax rate of 9.90% and no state sales tax).

Ann Arbor vs Salem Cost of Living 2026

Ann Arbor

Michigan

$1,630/mo est.

Salem

Oregon

$1,170/mo est.

Monthly estimate = 1BR rent + electricity + gas

A one-person monthly baseline (1BR rent plus typical utilities) runs $1,630 in Ann Arbor, MI versus $1,170 in Salem, OR. Overall, Salem, OR is roughly 28% cheaper to live in day-to-day than Ann Arbor, MI, driven mainly by rent.

Median household income is $81,089 in Ann Arbor, MI and $71,900 in Salem, OR — about 11% higher in Ann Arbor, MI. Michigan has a top state income tax rate of 4.25% and a 6% state sales tax; Oregon has a top state income tax rate of 9.90% and no state sales tax.

Ann Arbor, MI

Salem, OR

Rent

Studio

$1,274

$1,075

+16% in Ann Arbor, MI

1 Bedroom

$1,389

$989

+29% in Ann Arbor, MI

2 Bedroom

$1,692

$1,337

+21% in Ann Arbor, MI

3 Bedroom

$1,812

$1,778

+2% in Ann Arbor, MI

Buying a Home

Median Home Value

$435,100

$382,400

+12% in Ann Arbor, MI

Income

Median Household Income

$81,089

$71,900

+11% in Ann Arbor, MI

Metro Median Wage (annual)

$55,380

$55,310

+0% in Ann Arbor, MI

People & Lifestyle

Median Age

27.7 yr

35.7 yr

+8.0 yr in Salem, OR

Homeownership

45.6%

55.7%

+10.1 pp in Salem, OR

Bachelor's+ (25+)

77.7%

31.4%

+46.3 pp in Ann Arbor, MI

Avg Commute

19.9 min

22.4 min

+2.5 min in Salem, OR

Crime (per 100k/yr)

Violent Crime

311

540.6

+74% in Salem, OR

Property Crime

1,744.5

2,878.6

+65% in Salem, OR

FBI Crime Data Explorer. Offenses per 100,000 residents per year; agency reporting practices vary, so this is approximate.

Climate

Avg Annual Temperature

47.7°F

53.0°F

+5.3°F in Salem, OR

Annual Precipitation

32.8 in

39.7 in

+6.9 in in Salem, OR

Gas

Regular Gasoline

$3.85/gal

$5.21/gal

+35% in Salem, OR

Area: Midwest (PADD 2) vs West Coast (PADD 5).

Utilities

Electricity (¢/kWh)

23.0

16.3

+29% in Ann Arbor, MI

Natural Gas ($/MCF)

$19.72

$21.60

+10% in Salem, OR

Residential, state-level averages (EIA). MCF = 1,000 cubic feet.

Groceries

Milk (gal)

$4.31

$4.82

+12% in Salem, OR

Bread (lb)

$1.66

$2.04

+23% in Salem, OR

Eggs (doz)

$3.63

$2.19

+40% in Ann Arbor, MI

Ground Beef (lb)

$6.77

$7.36

+9% in Salem, OR

Chicken (lb)

$2.10

$2.01

+4% in Ann Arbor, MI

Bananas (lb)

$0.62

$0.70

+14% in Salem, OR

Average prices — Midwest vs West (BLS). Regional where available, otherwise U.S. average.

State Taxes

Sales Tax (MI / OR)

None

+6.0 pp in MI

Income Tax (top rate)

4.25%

9.90%

+5.7 pp in OR

Ann Arbor vs Salem — FAQ

Is it cheaper to live in Ann Arbor or Salem?: Salem, OR is cheaper. Its monthly baseline of $1,170 (1BR rent + utilities) runs about 28% below Ann Arbor, MI's $1,630, mainly because of rent.
How much more do you need to earn to live in Ann Arbor than in Salem?: To keep rent near the recommended 30% of gross income, you'd want to earn roughly $56,000 a year in Ann Arbor versus $40,000 in Salem.
Which has lower taxes, Ann Arbor or Salem?: Ann Arbor is taxed under Michigan's rules (a top state income tax rate of 4.25% and a 6% state sales tax); Salem under Oregon's (a top state income tax rate of 9.90% and no state sales tax).

Sources: US Census Bureau, ACS 5-Year (rent, income, home value, demographics); NOAA Climate Normals 1981–2010 (climate); EIA weekly retail (gas); Tax Foundation 2026 (state taxes).