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Instead of paying Wyoming, Montana, or Colorado prices, consider buying a cabin in the Black Hills of South Dakota.
It’s no secret that mountain towns can be incredibly pricey, particularly those in Colorado, Wyoming, and Montana. While you can still find pockets of these Western states where the real estate market hasn’t yet exploded, for the most part, you’re going to be paying a pretty penny to own a home in or near places like Telluride, Vail, Jackson Hole, Bozeman, and Big Sky.
If you want a full-time home or a vacation property with easy access to the mountains and the outdoors-focused lifestyle that’s synonymous with this part of the country—and you haven’t yet found something in your budget—you may want to expand your search to South Dakota. Yes, a large portion of the state is made up of prairies and farmland, but the Black Hills in southwestern South Dakota are home to a handful of relatively affordable mountain towns.
According to David Kahler, broker/owner at Keller Williams Realty Black Hills (KWBH) and Wyoming and the team leader of The Kahler Team, real estate in the Black Hills surged during the COVID-19 pandemic, mirroring the trend experienced in other parts of the country. “Our average appreciation rate will run 3 to 5 percent. And the COVID years were 20-plus. You saw a house at the beginning of COVID at $150,000; that same house today is going for close to $400,000,” he tells Travel + Leisure. Now the market has stabilized. “We really haven’t seen much appreciation this year—and I don’t feel we will. It’s kind of hit a sweet spot, and that’s where it’s holding,” he says. As of early 2026, the median sale price of a home in the Black Hills is $383,957.
Kahler also shares that while it’s not necessarily a buyer’s market right now, the “buyer has a lot more selection to go after today,” with everything from fixer-uppers and investment properties to multimillion-dollar homes. “You’ve got a mixture all the way across the board,” he says.
So where exactly in the Black Hills should you look to buy a mountain home? Kahler recommends a few places—from Spearfish, the “Queen City” of the Black Hills, down to Custer, one of the best gateway towns to Custer State Park, Wind Cave National Park, and Mount Rushmore. Below, we rounded up his recommendations and compared them to similar offerings in Montana, Colorado, and Wyoming.
Spearfish
Consider Spearfish your jumping-off point for all things outdoors: fly fishing, hiking, biking, scenic drives, wildlife spotting, and cross-country skiing. Because it’s the gateway to the Spearfish Canyon Scenic Byway—and its waterfalls, stunning fall foliage, and wildlife—the small mountain city attracts tourists from around the world. That said, Kahler notes that Spearfish has one of the “greatest opportunities” for keeping rental or vacation homes filled. If you are looking to buy in Spearfish, be aware that the market is “somewhat competitive,” per Redfin, and the average home value is just over $450,000. But if you compare that to the prices in Bozeman, a Montana destination that also serves as a base camp for outdoor adventurers, it’s significantly more cost-effective, at nearly $300,000 less on average.
Deadwood
A historic mining town in the Black Hills, Deadwood is an excellent choice for those who want to spend their free time hiking, snowmobiling, or skiing. “The city itself is older, and the outskirts have some property with acreage and privacy,” says Kahler, noting that Deadwood, just about 50 miles from Rapid City, is at a higher elevation, which means it’s one of the snowiest cities in South Dakota.
If this is your idea of a perfect mountain town, expect to pay around $450,000 for a home. While not exactly cheap, Deadwood is more affordable than somewhere like Red Lodge, Montana, a charming mountain town and resort with 1,635 skiable acres where average home values are nearly $100,000 more. As Kahler warns, though, Deadwood has restrictions on Vrbos, Airbnbs, and other short-term rentals—so keep that in mind when purchasing property.
Rapid City
Although Rapid City isn’t a mountain town, it does sit on the eastern edge of the Black Hills—ensuring you’re never too far from hiking and biking trails, places to climb, or gorgeous drives. Rapid City is home to a university, and its residents enjoy everyday amenities like great restaurants, breweries, and shopping, with an average home value under $370,000, about $200,000 less than Fort Collins, a similar city in Colorado. Kahler says it’s also your best bet if you want to invest in a rentable property; Rapid City is the main hub for Western South Dakota and the Black Hills region.
Hill City
When it comes to creative mountain towns in South Dakota, Hill City stands above the rest. It’s the type of destination where you can spend hours perusing galleries, sipping lattes at coffee shops, and enjoying leisurely meals at restaurants and breweries. As the “Heart of the Black Hills,” Hill City is also known for its proximity to a number of iconic places, including Custer State Park, Crazy Horse Memorial, and Mount Rushmore. It doesn’t have its own ski resort—à la Whitefish, Montana—but the warmer months give way to horseback riding, hiking along the Mickelson Trail, rock climbing, and mountain and fat-tire biking. Plus, its relative affordability is one of its defining features. According to Zillow, the average home value in Hill City is about $485,000—about $400,000 less than that of Whitefish.
Custer
Heading into the southern Black Hills, you’ll come across Custer, known as the oldest Black Hills town established by European-Americans. A Gold Rush boomtown that dates back to 1875, Custer is now an affordable small town with Western shops and boutiques lining its Main Street—very much like Jackson, Wyoming. And while Jackson has proximity to national parks like Grand Teton and Yellowstone, Custer has Custer State Park, Wind Cave National Park, and Mount Rushmore. Of course, Custer real estate prices aren’t at all comparable to those of the Cowboy State’s most famous town (where you won’t find anything below $1 million). Here, the average home value is only about $490,000.
Read the original article on Travel & Leisure
