May Bozeman Real Estate Report
As ski season has given way to biking, hiking, and fishing season, the strong Real Estate season is also upon us. While this article generally focuses on sales of single family homes; condos & townhouses make up a large part of our market as well.
Condos & townhomes are in strong demand and inventory is low. Pricing, which rose more slowly than single family home pricing, has now climbed well above previous peak levels. For the first quarter of 2017, 87 condos & townhomes have already sold at a median sold price of $275,000. In addition to those sales, another 115 units are currently under contract or pending. At this point last year, 100 units were pending and 94 had sold at a median sold price of $224,450.
This big jump in median pricing could partly be due to such a small sample size. Comparing all of 2016 sales to previous years, we see that 509 units sold in 2016 at a median sold price of $235,000. This is compared to 495 units sold in 2015 at a median sold price of $209,000. The previous peak year was 2006, when 442 units sold a median sold price of $205,450.
An interesting note on the 509 units sold last year; This is more than twice the number of units sold during 2010, the lowest year of the recession for sales volume when 212 units sold at a median sold price of $160,000. 2011 was the worst year for pricing, when 272 units sold at a median sold price of $150,000.
Although there has been a lot of talk of interest rates rising soon, they continue to remain low. As of writing, they’re currently hovering right around 4% for a conventional 30 year fixed mortgage. Combine these low interest rates with the rising local rents around the valley and it makes the case for homeownership even stronger. Buyers should not underestimate the effect of rising interest rates on the affordability of a home.
As usual, I have included data for the number of single family homes sold during the first 3 months of 2017. In addition to the 187 single family homes sold during this time period, another 201 homes are currently pending, or under contract, as of the date of writing this article.
The included data reflects sales of homes in the greater Bozeman area, including Four Corners, Gallatin Gateway, Bridger Canyon, and Bozeman city limits. The data includes home sales reported through the local Southwest Montana MLS, and does not include private party sales, Condominiums, or Townhouses.