Distinctly Montana Magazine

D I S T I N C T LY M O N TA N A • S P R I N G 2 0 1 6 78 MONTANA REAL ESTATE CYCLES IN REAL ESTATE THE STATE ECONOMY WAS POSITIVE IN 2015 OVERALL WITH OVER 6,000 NEW JOBS AND AN INCREASE OF $600 MILLION IN WAGES AND SALARIES WHEN COMPARED TO THE PREVIOUS YEAR. e cyclical nature of real estate is most certainly not an exact science, but there is much to learn when we take a step back to see what has transpired. Where are we currently? Correction, stabiliza- tion, recovery, revival? We are clearly in a state of strong stability in all parts of the state, with the exception of the communities in eastern Montana that have been impacted by the decline in oil production. e immediate forecast looks even stronger for the coming year. Each geographical market center in Montana has its own unique characteristics, but the similarities are interesting to identify. In January, I attended the Montana Association of REALTORS® (MAR) winter meetings in Helena, wherein the Montana RE- ALTOR® boards from across the state convene and share their annual market statistics. Additionally, the Bureau of Business and Economic Research recently did its statewide tour for the 41st An- nual Economic Outlook Seminar and provided a comprehensive economic report. At a state level, median home sales prices have surpassed the level from the top of the last housing boom. Sales are up, and inventories are down. Multi-family construction has been particularly strong. e state economy was positive in 2015 overall with over 6,000 new jobs and an increase of $600 million in wages and salaries when compared to the previous year. To compare some housing numbers, the Gallatin Association of Realtors® figures include Bozeman, Belgrade, Manhattan, ree Forks, Big Sky, Park County, and a few other outlying areas. If we combine the sales for this Multiple Listing Service (MLS), resi- dential sales increased to 2,936 in 2015 from 2,697 with an average sales price for the year of $354,673 and a median of $270,000. Gallatin County attributes 28% of its economic base to State Gov- ernment and Montana State University, so the growing university enrollment is key. Retail is still going strong, high tech is adding continued value, and construction is the best in the state. e Billings Association, which includes a 70-mile radius from Billings, showed a residential sales gain in 2015 to 2,612 reported units up from 2,468 in 2014. e average sales price reported to MAR for 4th quarter was $240,375, and the median was $214,950. e economy has not yet felt any strong impacts from the declining oil and gas industry, and the government and healthcare sectors are remaining stable. e retail and services industries are the two areas that have been identified as "vulnerable." e Flathead market jumped back up to 2,212 units sold in 2015 from 1,944 in 2014. e 4th quarter's average sold price ended up at $315,707 with a $245,000 median. e two largest growth areas are retail and healthcare, but manufacturing, wood products, and T he phrase "timing is everything" applies to many concepts; the real estate industry is especially susceptible to this notion. Delaying a purchase decision when interest rates are on the rise can equate to thousands of additional dollars during the life of the loan. Attempting to time the market to buy low or sell high may amount to large difference in sales price if the consumer waits even a few weeks too long.

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