Ode to Good News

Robyn Erlenbush
CRS, GRI, CRB, Broker Owner
Phone: (406) 586-1321
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Each year, we eagerly await the final December home closings to be entered and tallied.  Once again, it’s time to take our annual market at a glance overview of some key statistics from the real estate happenings of 2009.  The data presented in this article is from the Southwest Montana Multiple Listing Service (SWMLS).  As important as it is to focus on the complete story, it is also refreshing to spotlight the good news and segments of the market that are leading the recovery in Bozeman.  Two principal indicators are favorable:  decreasing inventories and increased sales for the 4th quarter.  And notably the inventory levels for homes under $300,000 are at a very healthy supply rate.  

Within the Bozeman city limits, there were 289 single family homes sold in 2009, compared to 312 in 2008.  There were 193 condos/ townhomes sold in 2009, compared to 247 in 2008.  The average sales prices in both categories showed reductions, with single family homes declining from $325,421 in 2008 to $276,939 in 2009, while attached housing went from $230,140 in 2008 to $198,938 in 2009.  The median sales prices were $256,000 for single family homes and $181,000 for condo/townhomes.  The supply of homes within the Bozeman city limits reported in December 2009 declined 26% from the inventory levels of December 2008.  This has been a positive trend for the prior 3 months and is most certainly a step in the right direction for the real estate market stabilization.   

The Belgrade area market remained stable with 158 single family homes being sold in both 2008 and 2009.  However, the average sales price decreased from $300,195 in 2008 to $232,987 in 2009.  The condo/ townhome market experienced decrease in both the units sold and average sales price.  There were 31 sales in 2009 compared to 49 in 2008 with an average sales price of $127,774 in 2009, down from $158,394 in 2008. In Belgrade, the supply of homes available for sale decreased 29% during that same time comparison, indicating progress toward a better balance of buyers and sellers.

The market in Livingston/ Park County had 112 single family homes sold in 2009 compared to 123 in 2008.  Average sales price decreased from $282,547 in 2008 to $247,380 in 2009.  Condo and townhome sales in Livingston showed a drop from 19 to 13 units in 2009 with a corresponding average price decrease from $155,799 to $150,600.

The Big Sky market, including Gallatin Canyon, reported a small increase in number of single family homes sold from 38 in 2008 to 41 in 2009.  However, the average sales price decreased from $1,394,846 to $855,234.  Condo and townhome sales remained similar with 59 sold units in 2009 versus 62 units in 2008.  There was quite a dramatic average price decrease from $683,240 in 2008 to $317,044 in 2009. In Big Sky, the residential inventory levels have tightened for the first time in several years.  Comparing December of 2009 with 2008, there is a 15% decrease in supply.  Condos have also declined in supply by 5% during this same time period.  Furthermore, the inventory that is selling is well-priced at a fraction of former prices.  Out-of-state buyers are returning to Big Sky and recognize the value proposition.  Most area brokers are reporting increased activity and sales.
 
Different price ranges also vary greatly in how long a home is anticipated to be on the market and on how close to asking price the offers may be.  For instance, homes within the Bozeman city limits that are priced under $275,000 are positioned well to sell more quickly.  Based on current supply and the number of homes sold in this price range in the last 12 months, there is only a 4.39 month supply currently on the market compared to 11.11 months for all inventory.  

Some of the best news centers around sold units for the 4th quarter of 2009.  Single family homes in Bozeman, rural Bozeman, Belgrade, and Manhattan/Three Forks reported 190 units closed in the 4th quarter of 2009, compared to 126 in 2008 and 162 in 2007.  The condo/ townhome market saw year-over-year increases with 2009 reporting 73 sold transactions, compared to 44 in 2008 and 78 in 2007.  

While 2010 has a ways to go to see where it will fall in the record books, it appears to be off to a good start and topping 2009 numbers.  With the first time homebuyer’s tax credit in place until the end of April, and interest rates very favorable for purchasers with good credit AND lower inventory level, there is no compelling reason to wait.  Especially in the entry level market, now is the perfect time to buy.