It’s not news that the real estate market in Western Montana – as in the rest of the country – isn’t very good. But it’s hard to tell for the moment where on the spectrum bounded by “soft” on the one end and “total disaster” on the other it actually sits. Most Montana markets are small, and thus don’t have huge transaction volume – especially in the winter. That makes it hard to value things. And because Montana is among the relatively few states that doesn’t make real estate transaction prices a matter of public record, it can be especially hard to tell what’s going on.
The one thing we know for sure is that transaction volume is way down. A recent report from the real estate brokerage Norman C. Wheeler, cited in the Bozeman Daily Chronicle, says that sales of big amenity ranches are down by 75% in the last two years. On the other end of the market, only 64 of 600 listed lots under one acre in the Bozeman area sold last year. And sale prices were barely half the listing prices – a sure sign that anemic volume is translating into much lower prices.
A couple of recent anecdotes from friends around Missoula are also not very encouraging. Several people I know went to get their houses refinanced, and after paying the application and appraisal fees were told that their homes did not appraise high enough to qualify. (The mortgage broker in at least one of these cases used Zillow.com to assure the customer that the house would appraise high enough – further proof, if any was needed, that you can’t believe everything you read on the Internet.)
If you have the wherewithall to play for the long term, though, this is an interesting moment. As reported in the Missoulian today, developer Scott Cooney has reached an agreement to buy the Bonner millsite property – 170 acres at the mouth of the Blackfoot – from the Stimson Lumber Co. Cooney already owns several parcels around the mill, and has spoken of creating a various types of commercial and residential developments in the area.
The deal still has some hurdles to clear before its final, and Cooney and his partners will undoubtedly be looking at all manner of possibilities for the property. But if nothing else, it’s a bet that a few years from now at least some segments of the Montana real estate market will be back on their feet.