Top 10 Cities in Michigan for Rental Investment

Michigan sign

The state of Michigan has a plethora of different official nicknames. Some call it “The Great Lake State”, or “The Water Wonderland” due to the Great Lakes. Others call it “The Mitten State” or “The Wolverine State” because of the cold winters and fur trade that used to be a major source of income.

Michigan is a unique state for many reasons. The state is built out of two separate peninsulas and has borders on four out of the five great lakes. As such, there is an abundance of lakeside properties with scenic views. As a matter of fact, there is only one state to surpass Michigan’s numerous coastlines and that is Alaska. No matter where you are in Michigan, you can’t be more than 85 miles away from one of the great lakes.

The state’s numerous lakes and rural temperament make it an amazing place to go stargazing as there is little light pollution. A park called the Headlands International Dark Sky Park, one of the world’s first opened in 2017 in the state.

Michigan’s many different bodies of fresh drinking water helped make it a beer powerhouse. There are over 350 different breweries across the state, with many producing craft beers and ciders.

Music is also a very big thing in Michigan. From Hip Hop to Techno, Motown to Metal, there are plenty of musicians and bands in the great lake state. Many in the world of Rap have roots in the state. This includes Eminem, Kid Rock, Xzibit, and Insane Clown Posse. Plenty of famous rockers also call Michigan home, including Ted Nugent, MC5, Alice Cooper and Iggy Pop. This unironically makes Michigan, Punk Rock’s official birthplace. Motown artists need no mention as pretty much all of them are from Michigan.

Michigan & Employment

Historically Michigan was well known for car production with many different Ford & GM plants surrounding Detroit. The American auto industry has died down a bit since its heyday with many factories relocating to Mexico and elsewhere.

The farming industry is still very popular in Michigan. The food and agriculture industry in Michigan brings in over $107 billion dollars every year. It is the second most diverse agriculture industry in the USA following California with 300 different commodities being produced.

Michigan and specifically Detroit have been revitalizing in recent years. Michigan is home to a handful of different business incubators and tech innovation centers. In addition to that, some tech giants have shown interest in Detroit. This includes Amazon, Microsoft, and Apple which have opened the tech hubs in the city.

Honorable Mention – Cutlerville

Just 8 miles south of the downtown area of the larger city of Grand Rapids, sits the community of Cutlerville. It’s a small suburban municipality, roughly 40 minutes from the beaches of lake Michigan. One of the town’s bigger employers is the Pine Rest Christian Mental Health Services which has a large campus in town.

The population of Cutlerville has grown by 17% since the last census bringing the number of residents to 16,895 in the town. The rate of homeownership stands at 66% which is close to the national average. Housing is rather on the inexpensive side. Despite climbing by 17% since 2021, housing prices average at $260,000 with median rent at $900 per month.

10 – Ann Arbor

Ann Arbor Art Fair
Source: Wikipedia

40 miles west of Detroit sits the city of Ann Arbor. It’s a peaceful university city that is home to the University of Michigan and the large medical center. The Huron River splits the city into two different parts. There are a handful of beautiful parks, with some of them on the river. Ann Arbor is sometimes called “tree town” affectionately by its residents due to the cast number of trees in the city and around it. The city was voted as #27 out of 100 Best Places to Live according to CNNMoney in 2008.

Ann Arbor’s population has grown 1.49% since the 2010 census which is rather low for this list. The key is the population. Ann Arbor has one of the lowest median ages in any American city with the average age being 27 years old. The rate of homeownership is also low at 45%, meaning that there is a healthy and vibrant rental market. As per 2022 the average home value has reached $470,000, a 12% increase since 2021. Rent is reported as $1,237 per month on average.

9 – Frankenmuth

Frankenmuth Visitor Center
Source: Wikipedia

This oddly named city of Frankenmuth is located halfway between the cities of Saginaw and Flint, Michigan. Many of the residents claim German/Bavarian ancestry and many buildings in the downtown area were built in a Bavarian style. This gives the town a unique and picturesque charm. The town also has a handful of bars, taverns and beer gardens as part of its German heritage.

Frankenmuth has grown by 19% since the 2010 census, bringing the number of residents to 5,901 in the town. Its annual growth The rate of homeownership is rather high with 69% of residents owning their home. The average home value is listed as $298,000 which is affordable and has increased by 17% since 2021. Rent is also affordable and is listed as $800 on average.

8 – Kent City

20 miles north of Grand Rapids sits the small suburban municipality of Kent City. It is home to a stunning golf course called “The Falls at Barber Creek” which features some waterfalls. There is also the Stoney Ridge Vineyards which offers tastings to the public and sells its locally produced wine. Other than that, Kent City has an all-American small town vibe which is charming.

The local population has grown 18% since the 2010 census, bringing the population to 1,250 residents. The city is growing at a rate of 1.71% per year. The population is young but has an above-average rate of homeownership. Home prices are listed at $280,000 on average, a 17% increase since 2021. The average rent is listed as just below $600 per month.

7 – Byron Center

Just west of Cutlerville is the city of Byron Center. Like Cutlerville, Grand Rapids is just a stone’s throw away. It is also a calm and peaceful suburb with many new single family homes built in recent years. Byron Center is also home to Whistlestop Park, a large community park that features some walking paths, baseball fields, and a fishing creek.

Byron Center’s population has increased by 21% since the 2010 census. The town is currently home to over 7000 residents currently living within its boundaries. Homeownership levels are rather high at 87% making rentals sparse. Housing prices have been on the increase and have grown by 15% since 2021. Currently average housing costs $387,000 while monthly rent is listed at $900.

6 – Allendale

Not to be confused with Allendale in England, Michigan has its own city named Allendale. Like other cities on the list, it is just a short distance from Grand Rapids. It sits on the banks of the Grand River, and as such has some great parks & fishing spots. Allendale is also home to Grand Valley State University, a higher education institution. This makes it a University town with a very young population.

Allendale has a population of 21,000, a 21% increase since the 2021 census. As a University town, the rate of homeownership is rather low at 53%. This does show a vibrant rental market. Housing prices have outpaced the population growth with a 23% increase since 2021. The average home costs $343,000. Rental prices are low on the other hand and are listed at around $1000 per month

Housing prices
Source: Zillow

5 – Auburn Hills

Roughly 30 miles north of Detroit, sits the municipality of Auburn Hills. It is also a university town with Oakland University and Oakland Community College within its borders. There is also the SEA LIFE Michigan Aquarium which offers many family-friendly exhibitions and LEGOLAND Michigan. In addition to that, there are a handful of public parks in the area and two different golf courses.

In many ways, Auburn Hills is a typical upper-class college town. The population is young with an average age of 32 and is usually highly educated. The number of residents has grown by 23% since the 2010 census with 27,000 citizens within its borders. Like many different university towns, the rate of homeownership is low at 44%. Housing is affordable despite a 12% increase in 2022 alone and averages at $238,000, rent, on the other hand, is listed at $1,117 per month.

4 – Vicksburg

Main Street Vicksburg Michigan
Source: Wikipedia

South of the city of Kalamazoo, sits a smaller municipal city of Vicksburg. It sits on the banks of Sunset Lake and has a nice park on its shores. Vicksburg also hosts the Vicksburg Historic Village which is a museum that shows off the town’s historic buildings. The town is also home to Cision Technologies which creates precision machined components and employs many of the residents.

Vicksburg’s population has grown by 26% and is growing at a rate of 1.85% per year. It is a rather small municipality with only 3600 residents but is growing fast. The rate of homeownership is listed at 77% which is rather high and can be advantageous for landlords. Average housing prices are affordable even after increasing by 15% since 2021 and are listed at $246,000. The monthly rent is rather low however and is listed at just $700 per month

3 – Richland

10 miles northeast of Kalamazoo sits the town of Richland, Michigan. The small municipality was a sleepy farming village for decades until the 1990s when some businesses moved into town. This includes Richard Allen Medical which is on its outskirts. Many within the community commute to nearby Kalamazoo for work.

Richland’s small-town charm has brought in quite a few new residents. Its population has grown by 26% since the 2010 census, bringing the number of residents to 950. The average age of residents is above average at 48 years old. This suggests an older population and retirees in the area. It may also explain the high rate of homeownership, which stands at 84%. Housing prices have increased by 14.9% in the past year and cost $318,000 on average. The rent is rather low at $850 per month.

2 – Manton

10 miles north of the city of Cadillac is the suburb of Manton. In the 1990s an Amish Christian community was founded right outside the town. As such, there are plenty of traditional farmlands around the town and a horse & buggy may be spotted when driving around. The city also provides a bus service to Grand Rapids and Petoskey, Michigan.

The population of Manton has grown 30% since the 2010 census, bringing the number of residents to 1678 living within the city borders. It is growing at a pace of 2.50% per year. The rate of homeownership is listed at 60% which is roughly the national average. Housing prices are some of the lowest seen on this list and are $138,000 on average. This may explain the low monthly rent, which is listed as $627 per month.

1 – Dundee

Hub of the Highways
Source: Wikipedia

Nicknamed “the hub of highways” by some, Dundee is a few miles west of Monroe and roughly 50 miles south of Detroit. It earned its nickname due to several historic roads that criss-cross the downtown area. The town is split into two by the pleasantly named River Raisin with the Old Mill Museum on its banks. The city is also home to Farmer J’s World Record Corn Maze and other attractions

Dundee has grown the most out of the bunch and has increased by 31% since 2010 bringing the number of residents to 5186. Its annual growth rate is listed as 3.91%. Home ownership is close to the national average as is the median age. Housing has increased by 13% in the past year alone, bringing average prices to $261,000 as per 2022. This may be why rent is listed at $830 per month.

Average housing prices Michigan
Source: Zillow

Michigan & Real Estate

Michigan is a state with a low cost of living, amazing lakes, affordable property, and is returning to its previous glory. It can also be a great spot to invest in. Lower property prices can allow some investors to develop a portfolio of properties easily. While it may not be growing at pace of other states like Texas, there’s always things to do and fun to have in Michigan!

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