October Greetings from Sharon and Brian,
What a beautiful fall we're having! Crisp, sunny, delightful! Montana IS the Last Best Place!
Some random reports, thoughts, and opinions on the Bozeman Area Real Estate Market:
STARTER HOMES: Many young people in the past purchased a condo or very small home to start. Present starter home buyers are thinking larger and longer term. They're thinking that, instead of 2-3 years, they'll be in this home for 5-7 years, and need to consider their family needs for that many years. With price reductions and foreclosures, buyers can sometimes get more square feet for just a little higher price. "Sweat equity" comes into the picture. Saving for the down payment is still a challenge, but many parents are helping these young folks, as usual. Banks are requiring better credit scores, but are still willing to work with first-time buyers and have many different types of loans that can accommodate a variety of circumstances. A talk with your banker is the place to start! Then call us and we'll represent you as a buyer broker through the search and the process of the purchase.
At no cost to you, the buyer!
MOVING UP: Although it may be a little more complicated to move to a larger, more expensive home, it may still be worth the challenges. Even if your smaller, less expensive home is not worth as much in this market, a larger, more expensive home has lost even more of its value. And, as prices rise, the higher-valued home will more rapidly appreciate and you'll be way ahead in the next few years. Plus, you can enjoy years of living in a larger home with more space for your family and the amenities that will bring you joy.
FLAT PRICES: Our median prices for residential are still down from 2007 high: Bozeman prices are 78% of 2007 (down 22%), the area outside of Bozeman is 70% (down 30% from 2007), Belgrade and Manhattan about 73% of 2007 (down 27%), Big Sky is 46% (down 54%) and Paradise Valley is 81% (down 19% from 2007). All of these areas (except Big Sky which was down 18% in the last 12 months) are seeing fairly flat prices in the last years. There may be some more adjustments, but most experts think we're in a mostly flat price market. And inventory is stabilizing.
BUILDING RATES: We're still not seeing a big rise in home building, which would signify confidence on the part of developers and builders. However, there are some nice pockets of new construction in the lower ranges. When vacant land is priced lower, builders can offer lower prices, of course. And we're seeing nice homes being built in the $200-$250,000 range. With land prices down, larger homes can be less expensively built, and builders can give you a better estimate for custom homes. There are several multi-million dollar homes being built in the Yellowstone Club at Big Sky, which reflects that very high-end market in certain areas around the country that shows some movement. (We're talking $5-50 million.) The very wealthy around the country do seem to find real estate as a "safe haven."
EMPLOYMENT: According to Best Places.net, the unemployment rate in Bozeman is about 6.5% (compared to the national rate of 9%). Job growth is forecast at .58%, with future job growth over the next ten years being predicted to be 34.66%. All this bodes well for the future of real estate in Bozeman and the area.
PURSUIT OF HAPPINESS: We have to admit it - many people come here for the lifestyle - not for the high-paying jobs. (Although we do have more of those desirable opportunities with Right Now, Zoot, Bozeman Deaconess Hospital, and other innovative companies who are hiring!) Clear skies and fresh air, the majesty of the mountains surrounding our beautiful valley, culture in the worlds of music, theater, and art; sports of fishing, hunting, skiing, tennis, baseball, softball, "rodeoing", etc.; MSU for educational opportunities and the Bobcats; great health care and shopping. We have all the amenities to pursue that happiness!
INTEREST RATES: 30-year fixed mortgage rates have been hovering at record lows for several weeks. They may fall even further if the Fed takes actions to drive down long-term rates. The 4.01 rate is the lowest rate seen since 1951. 15-year fixed and 5- and 1-year adjustable rates are also at historical lows. It's amazing the difference these rates make in your monthly payments. Time to refinance or buy!
FORECLOSURE RATES: It looks like the rate of foreclosures may be lowering over the country. But part of that may be because banks are allowing owners to do a deed-in-lieu of foreclosure. That lets underwater owners sign their deed over to the bank (it may still affect their credit somewhat) and the bank will re-list as a bank-owned property. It saves everyone the legal expense of foreclosure, but the owners will still be headed to renting for a while. And the actual number of distressed properties doesn't change, although it may look like there are fewer foreclosures.
NO MORE "FLIPPING": Even though prices have dropped so much, it may be years before the market shows significant appreciation. So be prepared to "hold." If we're talking about your personal home, that's fine. It's your sanctuary, your family place, and it can be that for many years. It's not necessarily an investment that will grow quickly as it has in the past, but you can "Bloom where you're planted!"
BUY NOW? For buyers with the financial resources to obtain a loan, the willingness to put in some hard work, and the patience for a long-term investment, real estate remains a great buy. Call us to see how we can help!
Sharon Tudor Isler, Broker, CRS, GRI, SRES 556-5048
Sharon@Bozeman-RealEstate.com
Brian Tudor, Sales Associate, GRI, GREEN, SFR 556-5068
Brian@Bozeman-RealEstate.com
Leave A Comment