BUTTE, MT - Do you feel like you're able to keep up with your housing costs in relation to how much your household makes?

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If you answered "no," you aren't alone. It turns out that—after a recent report was published by Harvard—many in the U.S. are very worried about their financial future and wonder how they're supposed to afford purchasing a home, let alone keep up with the cost of living expenses. The report takes into account national home prices, which are—spoiler!—surging unprecedentedly, while also taking a peek at stagnate wages and rental struggles.

The struggles are especially felt here in Montana as the broader national trends appear to be echoed in our state that—as the study points out—has never experienced anything like this before. Let's take a look at the study and its statistics relevant to Montana, and what they mean.

Sell Your Arm and Leg for a Home in Montana, Today!

Our beloved home of Montana, which has historically been known to anyone outside of the state as a frontier with open land and plenty of room to build your dream homestead running aplenty, has undoubtedly been undergoing a massive influx in home pricing, especially in the more urban areas such as Bozeman, Missoula, and, now, even Butte. According to the Harvard report, U.S. home prices are reaching record highs, which surprises no one.

But what may surprise you is that, of the three Montana cities listed in the report (Missoula, Great Falls, and Billings), all three have seen increases that outpace the national average. In general, Montana home prices have increased so much so that the price increase is 128% higher than the national average. Ouch.

That means, for us locals, the dream of homeownership is slipping out of reach, with some properties in the more desirable locations seeing price hikes of over 30% in just the past year alone. That's okay though, because you hear what they say: our paychecks are going up too! That means it all evens out, right?

Prices Up, Wages Not Going Anywhere

So, to recap: prices are going up everywhere, including home buying, cost of living expenses, and even how much it costs for people to come to pick up your garbage. In the words of the great Nutty Professor: "That's some scary s***!" The news doesn't get any better: wages in Montana have remained relatively stagnant, highlighting the point of the Harvard report that wage growth is not competing with escalating housing costs.

It can't be that bad, right? Well, remember those three Montana cities I mentioned earlier that are covered in the report (Missoula, Great Falls, and Billings)? All three have been observed to have their wage-to-home-buying gaps increased exponentially since 1990. Looking at the numbers, Billings' home-price-to-income ratio—which looks at the wages of the average Montanan citizen and compares them to home price trends from 1990 to 2023—sits at a 96% positive change. Great Falls sits at a slightly higher 98% positive change, and Missoula tops both with a whopping 168% positive change.

What does that all mean? It means Montana home prices have vastly outpaced the average income. The average American individual income currently rests at $63,795. Montana's average individual income? $56,264.

Want to Rent? Free Yourself From the Trap

Many have reluctantly turned to renting indefinitely, as all other options have come up dry. In a way, this makes sense since renting in more rural areas in Montana can actually be cheaper than buying a new home. But all across the Treasure State, a steep climb in rental pricing has been observed (though, admittedly, Zillow has reported that renting in Montana is slightly cheaper in 2024 than compared to the previous year).

The increasing rent prices make it difficult for renters to save for a down payment, essentially trapping them in a cycle of renting rather than owning. How does one escape the trap?

Walking the Road Forward

As Montana grapples with the dual challenge of rising home prices and stagnant wages, the insights from Harvard’s 2024 report offer a crucial roadmap. For Montanans, the path forward involves bold policy decisions and community initiatives to ensure that the state remains a place where people can not only dream but also achieve the reality of owning a home.

So, get out there, go work your three different jobs, and maybe one day houses will be affordable again! One can hope...

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