Bozeman Real Estate Market Report
As summer weather descends upon the Gallatin Valley, we are just over halfway through the year. It is a great time to look back at the first six months and see how the real estate market has fared in Bozeman.
It can be beneficial to start on the supply side of things. The number of new listings has continued to decline over the past few years. From the first of the year through July 1 of this year, 541 single family homes were listed for sale in the greater Bozeman area, versus 584 homes during the same time last year, 592 in 2021—down from 649 homes listed in the first half of 2020, which was down from 722 in 2019.
These numbers represented a 10% decline in new listings from 2019 to 2020, and another 9% decline from 2020 to 2021. Last year, the decline was more modest at 1%, but this year saw another 7% decline in new listings. That puts this year’s number of new listings nearly 17% below the 2020 numbers.
Even though new listings declined, sales numbers this year are about on par with last year; 344 single family homes have sold in the first half of this year, versus 348 sales last year. Last year’s sales numbers saw a similar decline as the number of new listings from 2021 and 2020, when 434 and 435 homes sold, respectively.
Pending transactions are currently up when compared to last year. As of this writing, there are 113 home sales pending, versus 100 pending sales at this same time last year. Again, last year did see declines from the pandemic years. In 2021, 156 home sales were pending at this point in time, and in 2020, there were 230 pending sales of single family homes in the greater Bozeman area.
There are many ways to run the median sold price for Bozeman, depending on whether we include condos, townhouses, and homes outside of city limits. Looking at just single-family homes both inside and outside city limits, the median sold price has declined for the first time in years.
Looking at the first half of each year, median sold pricing climbed 37%, from $523,317 in 2020 to $715,000 in 2021. Last year, it experienced another 26% increase, to $900,000. This year, the median sold price for single family homes both inside and out of city limits decreased just slightly by 2.7%, to $875,000. It should be noted that this is still 22% above 2021 pricing.
Homes outside of city limits tend to be more expensive than homes inside city limits. Restricting the data to single-family homes just inside city limits, 2020 to 2021 saw an astronomical 42% increase, from $477,750 to $678,400. It then continued to rise another 18%, to $800,000 in 2022. That number also saw a slight decrease this year of 5.6%, to $755,000. This puts 2023 pricing 11.3% above 2021 for single family homes inside of Bozeman city limits sold during the first half of the year.
After dropping to perhaps its lowest level ever in 2021, the month’s supply of homes for sale has continued to increase towards pre-pandemic normalcy. This is the number of months that it would take to sell the homes currently on the market. Generally, anything below a six month supply is considered a seller’s market, and anything above a six month supply is considered a buyer’s market. Starting around 2017, it consistently hovered around three months. In 2021, it fell to 0.9 months. Last year, it crept up slightly to 1.3 months. This year, it is up again at 2.26 months. Some say that a “normal” or “healthy” market would have a five to six month supply of homes.
The median days on market has also returned to pre-pandemic levels. In 2021, the median days on market plummeted to just five days. That was down from 25 days in 2020, and 23 days in 2019. It continued to fall last year to four days. This year, the median days on market has returned to 21 days.
Interest rates remain volatile, and, for serious buyers, they should be checked frequently. As of this writing, they are up slightly from recent averages, hovering around 7%, depending on down-payment, credit score, and other factors.
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 Big Sky Country MLS, and does not include private party sales, condominiums, or townhouses.