Loading Content...
Big Sky, Montana: Soaring Home Values and Ownership Rates in a Mountain Resort Haven
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Big Sky, Montana, is a picturesque mountain community known for its world-class ski resort and outdoor recreational opportunities. The city has experienced significant growth and development over the past decade, reflected in its changing demographics and real estate market. From 2013 to 2022, Big Sky saw a general trend of increasing homeownership rates, rising average home prices, and fluctuating average rent prices.
The homeownership rate in Big Sky has shown an overall upward trend from 2013 to 2022. In 2013, 64% of housing units were owner-occupied. This percentage increased to 75% by 2021, before slightly decreasing to 71% in 2022. Concurrently, average home prices have risen dramatically. In 2016, the average home price was $755,723, which more than doubled to $1,863,444 by 2022. This represents a staggering 146% increase in just six years, indicating a strong correlation between rising homeownership rates and escalating property values.
Federal interest rates have played a significant role in homeownership trends in Big Sky. From 2013 to 2020, interest rates remained relatively low, ranging from 0.09% to 2.16%. This period coincided with the increase in homeownership rates from 64% to 72%. The low interest rates likely made mortgages more affordable, encouraging more people to purchase homes. However, as interest rates began to rise sharply in 2022 to 1.68%, we see a slight decline in homeownership to 71%, suggesting that higher borrowing costs may have started to impact buying decisions.
Renter percentages in Big Sky have generally decreased as homeownership rates increased. In 2013, 36% of housing units were renter-occupied, which declined to 25% by 2021, before slightly increasing to 29% in 2022. Average rent prices have shown significant fluctuations over this period. In 2013, the average rent was $1,026, which increased to $1,413 by 2019, representing a 38% increase. However, by 2022, average rent had decreased to $1,082, possibly due to the growing supply of rental properties or changes in the local economy.
In 2023, the average home price in Big Sky slightly decreased to $1,736,916, while interest rates rose significantly to 5.02%. Moving into 2024, we see a modest increase in average home prices to $1,801,914, with interest rates further climbing to 5.33%. This data suggests a cooling but still robust housing market, despite the higher borrowing costs.
Looking ahead, predictive models forecast continued growth in both average home prices and rent prices over the next five years, albeit at a potentially slower rate than seen in recent years. Home prices are expected to maintain an upward trajectory, potentially reaching or surpassing the $2 million mark by 2029. Rent prices are also projected to increase, possibly returning to and exceeding the peak levels seen in 2019-2021.
In summary, Big Sky has experienced a remarkable period of growth in homeownership and property values. The relationship between rising home prices and increasing homeownership rates has been evident, likely driven by the area's desirability and, until recently, favorable interest rates. While the rental market has seen some fluctuations, it remains a significant component of Big Sky's housing landscape. As the community continues to evolve, balancing the needs of both homeowners and renters will be crucial for sustainable growth.
