What’s the Average Cost of a Home in Bozeman? (…why are they so expensive?)
September 2021 – Bozeman Homes Cost $858,500 (average) = $675,000 inside Bozeman and $1,058,800 outside Bozeman…not cheap…anymore.
|SEPTEMBER||INSIDE BOZEMAN (average)||OUTSIDE BOZEMAN (average)|
Therefore, trying to determine what a Bozeman home is worth by looking at (last) listing price would be close but still skewed a bit, as the percent of list price is from 0% to 2% higher than sales price.
In the last few years, most Bozeman home closed sales prices have been from 98.5% to 100% of “last list” price (chart 3), indicating a strong market.
Chart 1: The average sales price, aka, cost of a Bozeman house inside the city for 2020 was $590,742, up ⇑ $78,808 over 2019 and up ⇑ $112,399 over 2018.
Outside the city, the highest average price for a Bozeman, Montana home for 2020 was $914,064, up ⇑ $149,550 over 2019 and a staggering increase of ⇑ $246,087 over 2018! Houses are expensive in Bozeman!
The average cost of a Bozeman house increased 21% (inside city) and 24% (outside city) in the last two years.
Chart 2: The median price for a Bozeman home inside the city in 2020 was $540,000; in 2019, $460,000; and in 2018, $427,500. This is a ⇑ 21% increase in just 2 years.
Outside the city, median price for a Bozeman home in 2020 was $681,151, up⇑ $127,151 over the previous year and a hefty increase of ⇑ $166,151 over 2018, just 2 years ago!
These are significant market price increases in just one year for average and median Bozeman home sales prices.
Which Is Better, Average Price vs Median Price?
We’re dealing with Average and Median single-family Bozeman home costs (closed sales) here:
When looking at Bozeman home price statistics, “average” price tends to be the preferred statistical method.
“Average” price is found by simply adding all numbers and then dividing the sum of these numbers by the amount of these numbers.
“Average” price often depicts wild price swings, throwing off your search for a reasonable reflection of price.
“Median” price, on the other hand, is another common method. Used as as an numerical phrase, “median” signifies a “middle” price in a set of Bozeman house prices.
Frankly, using the “median” price results in a better depiction of the typical or the middle price than using “average” price.
To find “median” price, line up the prices in order of value, e.g., 5, 9, 15, 33, 47, etc., and simply pick the middle number, i.e., median is 15.
If the number of numbers is even, 5, 15, 33, 47, take the average of the two middle numbers 15 +33 = 48/2 = 24 and use that single number, 24, as your median price.
So, what about the cost of a Bozeman luxury home?
In 2020, the sales price of a Bozeman home outside the city increased 3% more than the sales price of a home inside Bozeman.