How Homebuyers Have Changed in Bozeman, Montana

In our Bozeman real estate market predictions post for 2025 we mentioned the changing buyer demographics. These changes have been happening over the past few years and are worth diving into deeper. This is something we are seeing nationwide, and the impact on Bozeman is even more evident. Let’s take a look.

The Numbers*

The percentage of first-time homebuyers has decreased to 24% of the market share, down from 32% last year. This marks the lowest share since the National Association of Realtors began collecting data in 1981. This decline isn't surprising, given the high interest rates and home prices. First-time home buyers already face significant challenges, such as saving for a down payment, and the current high interest rates further reduce their purchasing power.

The median age of a first-time home buyer increased to 38 years old. This number was 35 in 2023. From 2013-2021 this number hovered in the early 30’s. Again, this increase in first-time homebuyer age isn’t surprising in the current real estate market. Many have been holding off waiting to see if interest rates will come down along with the extra time needed to save for a down payment.

62% Of recent buyers were married couples, 20% were single females, 8% were single males, and 6% were unmarried couples. The percentage of married couple buyers has been decreasing over the years while single women have been increasing.

A significant shift in buyer demographics has been among those without children under the age of 18 living in their homes. This group accounts for 73% of buyers, marking the highest percentage recorded. In addition, 17% of homebuyers opted for multi-generational homes. The primary motivation for this choice was cost savings, cited by 36% of respondents. Following this, 25% indicated that their decision was influenced by adult children or relatives over the age of 18 moving back in with them.

Types of Homes have Changed

When it comes to buying homes, most purchasers prefer previously owned properties, with 85% of homes sold falling into this category. Only 15% of buyers are purchased new homes in 2024. The rising construction costs since the pandemic have made new homes less affordable. Additionally, many buyers are looking to avoid renovations, likely due to the current high prices of supplies and construction services. This trend has been evident in the Bozeman market, where fixer-upper homes or those needing repairs are staying on the market longer than move-in-ready homes.

Detached, single-family homes continue to be the most common home type for buyers at 75% with townhomes next at 7%. In Bozeman, we have seen a dramatic increase in the number of multi-family units under construction or scheduled to be built in the next two years. This has increased the demand for single-family homes in the area.

The Home Buying Process

In 2024, 88% of homebuyers worked with a real estate agent or broker. Only 5% purchased directly from a builder, while another 5% bought directly from the previous owner. Most homebuyers start their search online and then contact an agent as they progress further in the process. On average, buyers spent about 10 weeks searching for a home, typically viewing around 7 properties. Due to low inventory, it's common for the number of homes available within a buyer's price range to be fewer than 10.

In Bozeman, we have noticed that homebuyers are taking longer than 10 weeks to find a home. This is likely due to high home prices, buyers waiting for interest rates to stabilize, or waiting for more inventory to become available as we approach spring.

There has been a decrease in buyers who financed their homes. In 2023 this number was 80% and in 2024 it was 74%. All-cash buyers are at an all-time high with 26% of home buyers paying in cash. Again, this is not a huge surprise because of interest rates. Buyers continue to see purchasing a home as a good investment with 39% saying it is better than owning stocks. This indicates that while homebuyer demographics are changing, the real estate market is likely to remain strong in the future. Especially in a desirable place like Bozeman. If you are thinking of starting your home search, let us know. We would be happy to help!

*All numbers are based on national statistics from the National Association of Realtors and are not Bozeman-specific