I’ve been analyzing the latest Zillow Home Value Index data to uncover fascinating patterns in South Dakota’s housing market over the past decade and a half. This prairie state, known for its wide-open spaces and Mount Rushmore, reveals some surprising real estate trends. Most remarkable is the concentration of premium properties in two distinct regions: the scenic Black Hills area surrounding Rapid City in the west, and the growing communities near Watertown in the northeast. Keystone, gateway to Mount Rushmore, commands the state’s highest home values at $593,606, reflecting its unique position as both tourist destination and natural paradise.
What struck me most was the explosive growth in tourist-oriented communities near the Black Hills, with Keystone experiencing a remarkable 181% increase in home values since 2010 – nearly tripling in just 15 years. Meanwhile, several small communities near Watertown have emerged as surprising luxury enclaves, with towns like Henry and Castlewood commanding premium prices despite their rural setting. This reflects growing demand for lake properties and high-end rural living options as remote work enables more flexibility in choosing where to live.
Across these top 25 towns, the average five-year growth rate has approached 48%, significantly outpacing the national average and indicating robust demand in the state’s premium markets. Interestingly, several towns on this list show limited or no historical data before 2020, suggesting they represent emerging luxury markets or previously overlooked communities now experiencing rapid development and price appreciation as South Dakota attracts new residents seeking affordable alternatives to coastal states.
25. Chester
- January 2025 Home Value: $360,080
- January 2020 Home Value: $201,669
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 78.55%
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Chester’s lakeside location near Lake Herman and Lake Madison fueled dramatic home-value growth, surging nearly 79% since 2020 to $360,080 by 2025. Its proximity to Sioux Falls (just 25 miles away) adds accessibility and urban convenience. Growing demand for affordable lakeside living has transformed this small Lake County town into an emerging premium market. Chester’s appeal lies in scenic beauty, recreational opportunities, and affordability compared to established lake communities nationwide. The town increasingly attracts permanent residents and vacation buyers.
24. Montrose
- January 2025 Home Value: $366,940
- January 2020 Home Value: $236,025
- January 2015 Home Value: $160,377
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 55.47%
- Change from 2015 to 2025: 128.80%
- Change from 2010 to 2025: Not Available
Montrose, a charming bedroom community 30 miles west of Sioux Falls, has seen home values more than double since 2015, reaching $366,940 by 2025. Known for its quality school system and small-town atmosphere, Montrose offers a desirable rural lifestyle with convenient metropolitan access. Remote work trends have increased its attractiveness, particularly for Sioux Falls commuters seeking affordability and space. Proximity to Salem Lake adds recreational appeal, boosting values further. Montrose has successfully transitioned from quiet farming town to valuable suburban enclave.
23. Brandon
- January 2025 Home Value: $373,620
- January 2020 Home Value: $260,293
- January 2015 Home Value: $193,778
- January 2010 Home Value: $169,422
- Change from 2020 to 2025: 43.54%
- Change from 2015 to 2025: 92.81%
- Change from 2010 to 2025: 120.53%
Brandon’s outstanding school system and prime suburban location near Sioux Falls have driven home values to $373,620, more than doubling since 2010. Positioned along the Big Sioux River just east of the city, Brandon provides larger lots and newer homes while retaining easy access to urban amenities. Brandon Valley School District consistently ranks among the state’s best, attracting families and professionals. Its strategic position and educational excellence create sustained demand, solidifying Brandon’s place as one of South Dakota’s premier suburbs. The town perfectly blends small-town charm with suburban convenience.
22. New Underwood
- January 2025 Home Value: $375,517
- January 2020 Home Value: $210,847
- January 2015 Home Value: $160,597
- January 2010 Home Value: $163,190
- Change from 2020 to 2025: 78.10%
- Change from 2015 to 2025: 133.83%
- Change from 2010 to 2025: 130.11%
New Underwood, located 25 miles east of Rapid City, experienced exceptional growth, with home values rising 78% since 2020 to $375,517 by 2025. Offering rural tranquility and easy access to urban amenities via Interstate 90, the town appeals as an affordable alternative near the Black Hills region. Its remarkable 130% appreciation since 2010 reflects strong, long-term growth driven by affordable housing and commuting convenience. Residents enjoy small-town atmosphere with convenient employment options nearby. New Underwood represents one of western South Dakota’s fastest-growing residential markets.
21. Harrold
- January 2025 Home Value: $379,213
- January 2020 Home Value: Not Available
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: Not Available
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Harrold, a tiny community east of Pierre, emerged as a surprisingly premium market with home values reaching $379,213. Limited historical data suggests valuations likely driven by large agricultural estates or ranch properties. Its position in prime farming territory in Hughes County adds to its rural premium appeal. Limited inventory contributes to statistical anomalies elevating average values significantly. Harrold’s appearance reflects increasing demand for spacious rural properties offering privacy and acreage.
20. Hartford
- January 2025 Home Value: $385,701
- January 2020 Home Value: $260,603
- January 2015 Home Value: $187,150
- January 2010 Home Value: $160,654
- Change from 2020 to 2025: 48.00%
- Change from 2015 to 2025: 106.09%
- Change from 2010 to 2025: 140.08%
Hartford, located 15 minutes northwest of Sioux Falls, saw home values more than double since 2015, hitting $385,701 by 2025. This Minnehaha County suburb offers new housing developments, spacious lots, excellent schools, and affordability compared to Sioux Falls proper. Convenient access via Interstate 90 supports steady suburban growth as buyers seek balance between city amenities and small-town atmosphere. Hartford provides modern homes at attractive prices, drawing families and professionals alike. Its position as a premier suburban community continues driving impressive appreciation..
19. Whitewood
- January 2025 Home Value: $393,068
- January 2020 Home Value: $245,441
- January 2015 Home Value: $204,084
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 60.15%
- Change from 2015 to 2025: 92.60%
- Change from 2010 to 2025: Not Available
Whitewood, strategically positioned between Spearfish and Sturgis along I-90, saw values jump 60% since 2020 to $393,068. Offering a more affordable gateway to Black Hills recreation than deeper tourist towns, Whitewood appeals with convenience, scenic beauty, and relative affordability. Residents enjoy easy access to outdoor activities and urban amenities in nearby Rapid City. Whitewood’s premium market position reflects growing demand for accessible Black Hills living without excessive tourism crowds. It continues to draw buyers seeking natural charm and convenience.
18. Gary
- January 2025 Home Value: $396,189
- January 2020 Home Value: $263,764
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 50.21%
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Gary, near Minnesota’s border in Deuel County, emerged with home values reaching $396,189, up over 50% since 2020. Proximity to Lake Cochrane and Lake Elsie significantly contributes to its appeal, attracting buyers seeking affordable lakeside properties. Limited housing inventory creates statistical volatility, elevating average valuations. Gary balances scenic rural tranquility with highway access (Highway 212) to Watertown’s amenities. Its premium position reflects growing interest in affordable eastern South Dakota lake living.s in neighboring Minnesota likely contribute to its substantial recent appreciation.
17. North Sioux City
- January 2025 Home Value: $397,510
- January 2020 Home Value: $307,562
- January 2015 Home Value: $255,096
- January 2010 Home Value: $231,578
- Change from 2020 to 2025: 29.25%
- Change from 2015 to 2025: 55.83%
- Change from 2010 to 2025: 71.65%
North Sioux City’s strategic location and favorable South Dakota tax environment lifted home values to $397,510, up 71% since 2010. Adjacent to Sioux City, Iowa, the town attracts residents and businesses with advantageous taxes and Dakota Dunes’ upscale planned community. Its metropolitan accessibility and recreational amenities have sustained consistent appreciation. North Sioux City combines affordability, quality amenities, and convenient location, creating continuous growth. The area’s distinct value proposition continues to attract discerning homebuyers.
16. Astoria
- January 2025 Home Value: $397,921
- January 2020 Home Value: $279,300
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 42.47%
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Astoria’s home values rose to $397,921 by 2025, reflecting growing demand for eastern South Dakota lake properties, especially near Lake Hendricks on the Minnesota border. Limited inventory in this tiny Deuel County town results in statistical anomalies elevating average values. Despite its small population, Astoria attracts buyers looking for recreational access, rural charm, and affordable living within the Brookings area. Its emergence underscores the growing premium placed on South Dakota’s rural lake communities. Astoria epitomizes how even tiny towns can command high valuations.
15. Chancellor
- January 2025 Home Value: $411,736
- January 2020 Home Value: $260,487
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 58.06%
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Chancellor, southwest of Sioux Falls, surged nearly 58% since 2020, reaching $411,736 by 2025. Offering rural space with easy commuting distance, Chancellor increasingly appeals as remote work trends expand housing preferences. Its premium market position reflects growing demand for affordable rural properties near metropolitan centers. Limited housing inventory further elevates values, making Chancellor one of the state’s most valuable small towns. The community provides authentic rural lifestyle combined with urban accessibility.
14. Deadwood
- January 2025 Home Value: $414,725
- January 2020 Home Value: $258,267
- January 2015 Home Value: $206,945
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 60.58%
- Change from 2015 to 2025: 100.40%
- Change from 2010 to 2025: Not Available
Deadwood’s historic charm, tourism economy, and stunning Black Hills setting doubled home values since 2015, hitting $414,725. Known for Victorian architecture, casinos, and proximity to Spearfish Canyon and Terry Peak, Deadwood offers year-round appeal beyond its vibrant tourist trade. Gaming legalization revitalized the town, supporting premium valuations driven by historical significance and recreational access. Despite its remote location, Deadwood remains a desirable residential market, blending history, recreation, and tourism into steady growth.
13. Summerset
- January 2025 Home Value: $414,997
- January 2020 Home Value: $271,519
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 52.84%
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Summerset, South Dakota’s newest city near Rapid City, achieved remarkable 53% growth since 2020, reaching $414,997 by 2025. The planned community provides affordable, newer housing options between Rapid City and Sturgis, attracting families and professionals. Interstate access enhances convenience, while scenic Black Hills views boost property values. Summerset’s strategic location and modern amenities established it as a premier residential option near Rapid City, driving consistent appreciation
12. Custer
- January 2025 Home Value: $435,401
- January 2020 Home Value: $270,616
- January 2015 Home Value: $190,281
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 60.89%
- Change from 2015 to 2025: 128.82%
- Change from 2010 to 2025: Not Available
Custer’s central Black Hills location and gateway position to major attractions doubled home values since 2015 to $435,401. Proximity to Custer State Park, Mount Rushmore, and Needles Highway makes it an ideal base for outdoor recreation. Its historic downtown adds authenticity beyond tourism appeal, increasing desirability for permanent residents. Affordable compared to nearby tourist hubs, Custer provides premium mountain living at attractive prices. Demand remains strong for this charming mountain community.
11. Spearfish
- January 2025 Home Value: $436,711
- January 2020 Home Value: $288,532
- January 2015 Home Value: $233,241
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 51.36%
- Change from 2015 to 2025: 87.24%
- Change from 2010 to 2025: Not Available
Spearfish, known for its extraordinary scenery and educational amenities (Black Hills State University), saw values jump 87% since 2015 to $436,711. Residents enjoy Spearfish Canyon’s natural beauty, outdoor recreation, and urban conveniences rare for a town its size. Located at the Black Hills’ northern edge, it provides quick interstate access and year-round livability. Its balance of nature, culture, and convenience continues driving premium valuations and steady demand from permanent and second-home buyers.
10. Hill City
- January 2025 Home Value: $447,493
- January 2020 Home Value: $264,281
- January 2015 Home Value: $202,441
- January 2010 Home Value: $208,984
- Change from 2020 to 2025: 69.32%
- Change from 2015 to 2025: 121.05%
- Change from 2010 to 2025: 114.13%
Hill City, centrally located in the Black Hills, saw home values soar over 121% since 2015, reaching $447,493 by 2025. Its proximity to Mount Rushmore, Crazy Horse Memorial, and Custer State Park positions it ideally for tourism and recreation. A thriving arts community, historic charm, and award-winning wineries provide year-round appeal beyond seasonal visitors. Buyers are drawn to its balanced blend of small-town charm and convenient access to iconic attractions. Hill City remains a coveted residential market in the Black Hills region.
9. Goodwin
- January 2025 Home Value: $450,065
- January 2020 Home Value: $327,107
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 37.59%
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Goodwin, despite its tiny population, achieved a surprising home value of $450,065, rising nearly 38% since 2020. This Deuel County town benefits from proximity to northeastern South Dakota’s lake country and recreational opportunities. Extremely limited inventory likely creates statistical anomalies that boost average home values significantly. Still, Goodwin’s premium valuation highlights increasing demand for rural properties with lake access, acreage, and privacy. The town embodies growing buyer interest in scenic and affordable rural communities
8. Renner
- January 2025 Home Value: $469,545
- January 2020 Home Value: Not Available
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: Not Available
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Renner emerged as a desirable rural-suburban community near Sioux Falls, with home values reaching $469,545 by 2025. Just 7 miles north of Sioux Falls, Renner blends authentic rural atmosphere with exceptional urban convenience. Its proximity to the Big Sioux River enhances recreational appeal and scenic charm. Growing demand for spacious properties with easy metro access fuels Renner’s premium valuation. It has become a sought-after alternative for those wanting rural tranquility without sacrificing city amenities.
7. Wentworth
- January 2025 Home Value: $482,108
- January 2020 Home Value: $275,174
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 75.20%
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Wentworth experienced dramatic growth, with home values surging 75% since 2020 to $482,108 by 2025, driven by proximity to Lake Madison. Located 30 miles northwest of Sioux Falls, Wentworth offers lakeside living with rural tranquility and urban accessibility. Its limited housing inventory combined with demand for recreational properties elevates values significantly. Buyers increasingly seek its affordability and scenic appeal compared to established lake destinations elsewhere. Wentworth illustrates the rising desirability of South Dakota’s lake communities.
6. Hermosa
- January 2025 Home Value: $494,420
- January 2020 Home Value: $287,885
- January 2015 Home Value: $197,521
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 71.74%
- Change from 2015 to 2025: 150.31%
- Change from 2010 to 2025: Not Available
Hermosa, located between Rapid City and Custer at the Black Hills’ southern gateway, saw extraordinary appreciation of 150% since 2015, reaching $494,420 by 2025. Its strategic location provides spectacular mountain views and exceptional recreational access. More affordable than towns deeper in the tourist corridor, Hermosa attracts those seeking genuine Black Hills living at competitive prices. Residents enjoy proximity to Custer State Park, Mount Rushmore, and Rapid City amenities. Hermosa’s impressive growth highlights demand for accessible Black Hills real estate.
5. South Shore
- January 2025 Home Value: $507,128
- January 2020 Home Value: Not Available
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: Not Available
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
South Shore achieved premium status with home values at $507,128, benefiting from proximity to Bitter Lake in northeastern South Dakota. Its tiny population creates limited housing inventory, generating statistical anomalies driving higher average values. Nevertheless, it reflects authentic demand for waterfront properties near Watertown, appealing to recreation-oriented buyers. Residents enjoy rural tranquility, scenic beauty, and lake access within commuting distance of urban conveniences. South Shore exemplifies growing interest in northeastern lake communities.
4. Florence
- January 2025 Home Value: $525,150
- January 2020 Home Value: Not Available
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: Not Available
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Florence, located northeast of Watertown, reached impressive valuations of $525,150, likely influenced by limited inventory and larger agricultural or premium properties. Scenic rolling landscapes of nearby Coteau des Prairies attract buyers seeking rural beauty, acreage, and privacy. Florence’s premium market status demonstrates how even small towns can achieve exceptional valuations driven by natural appeal and strategic location. Residents benefit from authentic rural living within easy reach of Watertown’s amenities. Florence represents the rising value of spacious, scenic rural properties.
3. Castlewood
- January 2025 Home Value: $542,590
- January 2020 Home Value: $359,103
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 51.10%
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Castlewood, southwest of Watertown near Lake Poinsett, saw values surpass $542,590 by 2025, increasing over 51% since 2020. Waterfront access and recreational opportunities significantly boost its residential appeal. Limited housing stock and proximity to lakes elevate average values dramatically. Castlewood balances small-town charm with accessible urban amenities nearby, attracting both permanent residents and seasonal buyers. Its emergence highlights demand for lake-region real estate in northeastern South Dakota.
2. Henry
- January 2025 Home Value: $589,379
- January 2020 Home Value: $394,370
- January 2015 Home Value: Not Available
- January 2010 Home Value: Not Available
- Change from 2020 to 2025: 49.45%
- Change from 2015 to 2025: Not Available
- Change from 2010 to 2025: Not Available
Henry, west of Watertown, emerged as a premium market with home values approaching $589,379, driven by proximity to Dry Lake and private lakes. Its extremely limited inventory creates statistical volatility, elevating average valuations significantly. Buyers increasingly seek its recreational appeal, acreage, and rural lifestyle, fueling strong appreciation. Henry’s surprising market position underscores growing interest in northeastern South Dakota’s affordable lake communities compared to neighboring states. The town represents a distinctive rural premium market.
1. Keystone
- January 2025 Home Value: $593,606
- January 2020 Home Value: $351,520
- January 2015 Home Value: $248,855
- January 2010 Home Value: $211,377
- Change from 2020 to 2025: 68.87%
- Change from 2015 to 2025: 138.53%
- Change from 2010 to 2025: 180.83%
Keystone, gateway to Mount Rushmore, is South Dakota’s most valuable market, with home values tripling since 2010 to reach $593,606 by 2025. Its unmatched location surrounded by mountains and forests supports tourism and recreation, driving strong economic activity. Limited developable land combined with high visitor demand significantly elevates residential values. Residents enjoy convenient access to Black Hills National Forest, Custer State Park, and iconic attractions. Keystone’s premier status reflects a unique blend of natural beauty, tourism economy, and limited availability.
