Bozeman Cost of Living

Courtesy of Travis Anderson Photography

Annual Cost of Living index Report Released for Bozeman: Confirms that MIT Living Wage Calculator Underestimates Housing Costs

According to the latest Cost of Living Index report, which averaged data from the first three quarters of 2016, Bozeman’s cost of living sat at 0.8 percent above the national average for the year as compared to 264 other urban areas in the United States. Nationwide, the after-tax cost for a professional standard of living ranged from 128 percent above the national average in Manhattan, NY to about 24 percent below the national average in McAllen, TX.

The composite Cost of Living Index score is based on six categories – housing, utilities, grocery items, transportation, health care and miscellaneous goods & services. The national average composite index is set at 100 each period; so the index conveys relative price levels at a specific point in time. The Index does not measure inflation (price change over time).

Housing: The average monthly rental rate for a two-bedroom, 950 square foot apartment in the Bozeman area that met the index collection specifications was $1,022 for 2016. This is well above the housing cost estimates used in a recent Massachusetts Institute of Technology (MIT) living wage calculator that were based on federal rent estimates.1 The MIT calculator assumed that a two-parent, two-child family could rent a two-bedroom apartment in Bozeman for $771 a month.1

The average price of a new 2,400 square foot home on an 8,000 square foot lot that met the index collection specifications was $364,509. Mortgage rates are also taken into consideration when computing the housing index score. The 2016 housing index score was 108.1, meaning that area housing was 8.1 percent above the national average for the year.

All Other Categories: For Bozeman residents, two expense categories came in below national averages for the year: utilities and miscellaneous goods & services, which were 8.6 percent and 2.4 percent below average respectively. Health care expenses were 4.3 percent above the national average while groceries were a negligible 0.3 percent above average.

While typically well below the national average, transportation costs were slightly above average for 2016 with an index score of 100.9. This was largely influenced by transportation costs coming in at 9.9 above average as of July, since the annual index score averages the data from the first three quarters of each year. Transportation includes two data points: the price to balance car tires and the price of unleaded gasoline. The July price collection period seems to have coincided with area tire shops raising their rates combined with higher summer gas prices.

Area Comparisons: To put Bozeman’s index scores in perspective, the table below includes the cities with the most expensive and least expensive composite scores for the year—Manhattan, New York and McCallen, Texas respectively. The full press release linked below also includes the most comparable cities to Bozeman in the Western region that participate in the index.

Read the full press release >

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2016 Annual Average Cost of Living Index Results

Composite Score
Grocery Items
Health Care
Goods & Services

Bozeman, MT 








Manhattan, NY
Most expensive 2016








McCallen, TX
Least expensive 2016








1: Dietrich, Eric. “What is a living wage is in Bozeman — and who makes it.” January 18, 2017.