Bustling Midwest city tops new study of most affordable places to live in America

The bustling Midwest city of Detroit has been named the most affordable city in the US. 

That is according to a new report from online bill payment platform Doxo.

The major Michigan city, which is the birthplace of Motown, has taken the top spot for the third year in a row.

According to Doxo, monthly expenses in the city average $1,640, which is 23 percent less than typical costs across the US as a whole.

The Doxo report, which analyzes household expenditure across the 50 largest cities in the US, is based on actual bill data. 

It calculates the average monthly costs for 10 essential household bills, including rent, utilities and insurance, and benchmarks cities against the national average. 

But while Detroit's cost of living is low compared to the rest of the country, bills in the city take up a significant proportion of the $37,360 income for the typical household.

'In Detroit, household bills account for 53 percent of household income, making it a great city for those seeking reduced living costs but also highlighting economic challenges,' Liz Powell, senior director of Insights at Doxo, told Forbes.

That is compared to the national average, according to Doxo, where the typical household spends 34 percent of its income on bills.

According to the report, the average American household spends $2,126 per month on essential bills.

Despite high levels of inflation, monthly expenses in Detroit have stayed relatively stable, further cementing its position as the most affordable city in America.

The so-called 'Motor City' was once an industrial powerhouse, and home to the largest carmakers in the US. 

But the demise of the major carmakers, coupled with the mortgage crisis, drove millions from their homes in the 2000s as their properties were left worthless.

Less than two decades ago, one in five houses stood empty in the city, with foreclosures mounting and properties on deserted streets being sold for $1. 

But as the car industry - this time with a focus on electric vehicles - begins to pick up speed again, the value of homes in the city has risen rapidly.  

Despite the short-term price surge, Detroit still remains affordable as much of its growth was catch-up after years of lagging behind.

And Detroit is not the only affordable Midwest city on the list. 

Two Ohio cities ranked next - with Cleveland named as the second most affordable place to live in America, followed by Dayton. 

In Cleveland, monthly expenses average $1,735, which is 18 percent below the national average, whereas in Dayton, costs are 17 percent cheaper than the national average at $1,773. 

Indianapolis also rounded out the top 10, where households bills are 7 percent below the national average. 

'Findings show that cities in the Midwest offer some of the lowest average household expenses, providing an alternative for Americans looking to save on essential bills,' Powell told Forbes. 

On the other end of the spectrum, Doxo named San Jose, California, as the least affordable place to live in America. 

Here, at the heart of Silicon Valley, residents pay an average of $3,695 per month on household bills.

This is a huge 74 percent above the national average. 

The second most expensive city is New York, followed by Boston and San Francisco. 

The rankings have not changed much since Doxo started doing this report in 2022, Powell told Forbes. 

'While the same four cities top the list of most expensive cities in both 2023 and 2024, the order shifted slightly this year,' she said.