Rent vs buy in Montana
At today's numbers over 7 years, renting wins in 4 of the 4 cities of 50,000+.
Renting or buying in Montana's cities
| City | Verdict | 7-year result | Break-even (up to 30 yrs) | Typical home | Rent /mo |
|---|
Sources: Zillow Home Value and Observed Rent indexes. The verdicts come from our rent vs buy method with 20% down, over 7 years.
Our take on Montana
Local rents in Montana sit far below home prices, so renting wins in 4 of 4 cities of 50,000+ across 7 years. The typical home value is $467k, while median rent comes to $1,081 a month, well under the US figure of $1,413 a month. Your choice is driven by that gap. In Bozeman, a typical home runs $721,678 and rent runs $2,199. Stay 7 years and renting wins by $80k, with no break even until year 15. Missoula takes even longer. Buying costs you $563,970, while renting costs $1,622 a month. Renting comes out ahead by $89k there, and buying stays behind until year 21.
Cheaper cities still leave you ahead when you rent over 7 years. In Billings, a typical home runs $401,071 and monthly rent is $1,393. Break-even doesn't arrive until year 15 there, though renting wins by $43k. Great Falls has the shortest wait, with a typical home of $337,936 and rent of $1,433. Even so, renting comes out ahead by $14k over 7 years, and you must stay until year 10 for buying to pay off.
If you plan to buy, we also weigh ongoing costs and price growth. Over the long run, home prices rose 5.3% a year, and 7.9% a year across the last 10 years. Stay past your break-even year, and that growth works in your favor. You pay a 0.72% property tax as well, and that beats the 0.94% US rate. You pay $1,405 a year for homeowners insurance, against $1,308 a year in the US. Statewide, 141,459 households rent, which is 31%, less than the 35% US mark.
Our take: renting in Montana leaves you better off unless you stay put for 10 to 21 years or more.