Let’s Talk Real Estate

Looking back at 2021, it comes as no surprise that it was another fast-paced year for the real estate market. We’ve reviewed sales data for 2021 in each of the following markets including Greater Bozeman, Belgrade-Manhattan-Three Forks, Big Sky, Livingston, and Park County, as well as Ennis and Madison Valley. All markets are influenced by the basic economic principle of supply and demand. We are experiencing substantial price increases due to the lack of supply in all areas.

Inventory levels declined consistently over the last three years, based on the growing popularity of Southwestern Montana. This in-migration trend accelerated in the second quarter of 2020 with more out-of-state buyers relocating for many reasons, including the pandemic. It’s important to keep in perspective that declined inventory and increased prices are occurring not only in Bozeman and Montana, but throughout much of the United States.

Greater Bozeman

The Bozeman area has seen many changes with new construction including hotels and apartment complexes. The limited inventory is driving the average and median prices for all housing types up dramatically, setting new records. There were 978 single-family homes and 680 condo/townhome units sold in 2021. New construction delays and availability of shovel-ready building sites constrained the number of sales. However, several new larger developments and many in-fill projects are underway to help meet increased demand.

 

Belgrade, Manhattan, Three Forks

As the Bozeman market tightens, the communities of Belgrade, Manhattan, and Three Forks continue to grow. These markets are seeing an influx of home buyers due to the availability of building sites, new home starts, and lower sales prices. 511 single-family homes and 143 condo/townhome units sold in 2021. For the first time in market history, there are nearly the same numbers of sales in these cities as in Bozeman, 511 in comparison to 516.

 

Big Sky

Big Sky has experienced exponential growth for the past few years. Workforce housing and labor shortages are two pressing issues. Much is being done to ease these challenges, but it will take time and infrastructure investments to create relief. Big Sky has made great strides in the last decade with the construction of its hospital, newly finished community center, performing arts center, and expanded parks and school facilities. 2021 saw 94 single-family sales and 244 condominiums.

Big Sky has seen the biggest increase in prices, with median sales prices topping $2.5 million and condos over $1,000,000.

Livingston & Park County

Combining the nearness to Yellowstone National Park with great fly fishing and beautiful open valleys, Livingston is ideal for year-round and part-time residents alike. Condo and townhomes played a larger role in 2021 with 93 units sold, almost triple in the past 2 years. There were 291 single-family sales in 2021.

Ennis & Madison Valley 

Ennis is growing with like-minded people looking for the charm and simplicity of a small western town. With that, the Madison Valley has had an incredible year in real estate. Ennis saw a record number of sales with 108 homes, a 20% increase over the previous year. Land sales were very robust with 227 parcels closed and a 72% increase in median sales price.

Looking Forward to 2022

There is “light“ at the end of the tunnel, we just don’t know how long the tunnel is. Many new projects and developments are in the works and will eventually ease inventory woes. Prices will likely continue to increase at similar rates to 2020 and 2021. Eventually, as supply becomes more available, we may see market stabilization.