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Miles City, Montana: Rising Home Values and Shifting Ownership in a Ranching Hub
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
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Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Miles City, located in eastern Montana, is a vibrant community with a rich history rooted in the Old West. This city, known for its annual Bucking Horse Sale, has experienced fluctuating trends in homeownership and housing prices over the past decade. The overall trajectory shows a gradual shift towards renting, coupled with significant increases in both average home prices and average rent.
The homeownership rate in Miles City has seen a steady decline from 2013 to 2022. In 2013, 69% of residents owned their homes, but by 2022, this figure had dropped to 63%. This 6 percentage point decrease coincided with a substantial rise in average home prices. In 2015, the average home price was $140,207, which increased dramatically to $259,435 by 2022, representing an 85% increase over seven years. This inverse relationship suggests that rising home prices may have made homeownership less attainable for some residents.
Federal interest rates have played a significant role in shaping homeownership trends in Miles City. The period from 2013 to 2016 saw historically low interest rates, hovering around 0.1% to 0.4%. During this time, homeownership rates remained relatively stable at 68-69%. However, as interest rates began to rise from 2017 onwards, reaching 1.68% in 2022, homeownership rates declined. This trend aligns with the general principle that higher interest rates can make mortgages less affordable, potentially discouraging homeownership.
As homeownership decreased, the percentage of renters in Miles City increased from 31% in 2013 to 37% in 2022. This shift towards renting was accompanied by a significant rise in average rent prices. In 2013, the average rent was $601, which increased to $908 by 2022, representing a 51% increase over nine years. The population of Miles City remained relatively stable during this period, fluctuating between 9,700 and 10,000 residents, suggesting that the rise in rent prices was not primarily driven by population growth but rather by other market factors.
In 2023 and 2024, the housing market in Miles City continued to evolve. The average home price reached $265,928 in 2023 and further increased to $268,411 in 2024, showing a continued upward trend. Concurrently, federal interest rates rose significantly, reaching 5.02% in 2023 and 5.33% in 2024. These high interest rates, not seen since the early 2000s, are likely to have a substantial impact on the housing market and homeownership rates in the coming years.
Looking ahead, predictive models suggest that both average home prices and average rent in Miles City are likely to continue their upward trajectory over the next five years. Home prices are projected to increase by approximately 3-5% annually, potentially reaching around $310,000 by 2029. Average rent prices are expected to rise at a similar rate, potentially surpassing $1,100 per month within the same timeframe. However, these projections may be influenced by various factors, including economic conditions, local development, and changes in federal interest rates.
In summary, Miles City has experienced a notable shift towards renting over the past decade, driven by rising home prices and fluctuating interest rates. The significant increase in both average home prices and average rent has reshaped the housing landscape of this historic Montana city. As these trends continue, they are likely to have lasting impacts on the community's housing affordability and demographics in the coming years.
