Though coastal states (suppose California and New York) are sometimes touted for his or her lack of affordability, Montana—a Mountain West state identified for its pure magnificence and mountainous panorama—tops a Realtor.com record of states with the biggest affordability hole for homebuyers within the U.S.
In July, the median value for a house in Montana was $649,900, whereas the median family revenue was simply $72,066. That is virtually $100,000 lower than the advisable revenue for a home of that value.
Key Takeaways
- Montana has the largest affordability hole between precise family revenue and the recoomended family revenue wanted to afford the median dwelling value.
- The median dwelling value in July was practically $650,000, whereas the median family revenue was $72,066, practically $100,000 lower than the minimal advisable revenue wanted to afford that dwelling.
- Pandemic-driven demand from out-of-state patrons and chronically low housing inventory have pushed up dwelling costs throughout the state.
So as to comfortably afford a house within the Treasure State, you’d must earn way over $72,066, the median family revenue for Montana. Realtor.com calculated the minimal revenue wanted to afford that median-priced dwelling, and it got here to $171,301, virtually $100,000 extra.
Montana was thought-about the least reasonably priced U.S. state in a Realtor.com report—it had the biggest proportion distinction between advisable and precise revenue wanted to afford the median-priced dwelling in July.
Different states that made the record of least reasonably priced embody New York, Massachusetts, Hawaii, California, Rhode Island, and Idaho.
What’s Driving House Costs So Excessive in Montana?
At first look, it could could also be stunning that Montana, one of many least populated states within the U.S., could be thought-about one of many least reasonably priced states, too. Nonetheless, housing demand within the state elevated through the pandemic as distant employees from costlier elements of the nation flocked there to purchase properties.
An evaluation by Realtor.com discovered that, in 2021, second-home purchases in Montana comprised 20% of of all gross sales within the state.
“Montana’s housing market has grown costly as a consequence of an inflow of out-of-state patrons, particularly throughout and after the [COVID-19] pandemic, looking for distant work-friendly, scenic, and fewer densely populated areas,” mentioned Hannah Jones, a Realtor.com senior financial analysis analyst.
Main cities within the state, like Missoula, have develop into considerably costlier lately. The worth of a single-family dwelling in Missoula elevated from $372,000 in 2020 to $592,000 in 2025, in line with information from the Missoula Group of Realtors.
And it is not simply out-of-state demand that is pushed up the price of housing in Montana—it is also persistently low housing provide.
In keeping with a report from the Every day Montanan, a neighborhood nonprofit newspaper in Montana, there was 9.6% inhabitants progress between 2010 and 2020. On the identical time, the Every day Montanan discovered that there was solely 6.6% housing progress.
The Backside Line
It is essential to think about how a lot cash you make when deciding how a lot dwelling you may afford. In some states, the price of residing could also be low, however demand for housing can drive up costs, pushing a brand new dwelling out of attain. Whereas Montana will not be a state that will instantly come to thoughts as a spot with costly properties, it is develop into the highest state with an affordability hole so giant that residents might should look elsewhere after they’re prepared to purchase.
