Realtors report out-of-state rush on Montana real estate
(MTFP) Lydia Seely has wanted to move to Montana ever since her son came here five years ago. The California woman, who works in health care, had eyed properties in the Bozeman area in the past — initially as an investment, but someday as a primary home, she said — but was quickly priced out of the market.
Earlier this year, when her son decided to move to Missoula, Seely decided to take a second look.
Unfortunately for Seely, she wasn’t the only one.
According to anecdotal reports, Seely is one of many people from outside Montana currently looking for a home here. Interest in real estate in Bozeman, Missoula and the Flathead Valley has been on the rise for years, but real estate agents say that interest has hit a fever pitch in recent weeks as more people look to escape urban areas, especially those where the coronavirus has significantly upended normal life.
“We were going to have a really good summer even before the virus arrived, but now I think a lot of people just want to get out of the cities,” said Angie Friedner, a real estate agent in Whitefish. “That’s what we’re hearing from some buyers.”
Montana is a non-disclosure state, meaning it can be hard to trace where property buyers are from, but real estate agents statewide report big increases in interest from people wanting to leave urban areas. Friedner said as soon as the state entered phase two of its reopening plan and removed the 14-day quarantine requirement, “it was like the flood gates had opened” on inquiries.
Even before the state entered phase two, the real estate market was starting to heat up, according to the Montana Regional MLS. In January, the median sales price for a home in western Montana (Including Flathead, Missoula, Lewis and Clark and surrounding counties) was $282,500; five months later it had risen to $287,000.
The same bump is being seen in Gallatin County. In Bozeman, the median sales price for a single-family home has increased 11% in the last year, from $430,000 in May 2019 to $477,500 in May 2020. The number of closings did dip slightly between April and May, but agents anticipate that decline will be short-lived.
“There is a flood of people coming into the market,” said Crystal Ault, a Missoula-area real estate broker. “There is a frenzy in the market.”
Like Friedner, Ault said she has had a number of clients from other states looking to relocate to Montana. In one instance, she described a family from Oregon that is looking for property to relocate their entire family, including both sets of parents. Ault said she has seen people make offers anywhere from $10,000 to $15,000 above the asking price. Last week, one of her clients made a cash offer $5,000 above the asking price and still lost out on the property because there were seven different buyers bidding on it.
Some would-be buyers are even resorting to apps like FaceTime to virtually tour as many homes as possible from afar. Both Friedner and Ault have had clients in recent weeks make offers on homes they’ve never stepped foot in. (Both note that the clients usually see the home during the inspection period and before the final paperwork is signed).
“Sight-unseen offers make me nervous,” Ault said, “but it’s just a new way of doing business. Real estate has traditionally been a face-to-face type business where you shake hands, but we’ve had to adjust.”
Seely, the woman from California, has also started doing FaceTime tours of properties in the Missoula area after preparing to make an offer on a home as she was touring, only to lose out to someone else.
“It’s a little bit scary,” Seely said of offering to buy a home without ever being inside. “You really have to have a lot of faith in your realtor.”
While nowhere near as busy as the markets in Flathead, Missoula or Gallatin counties, the Butte area is starting to see an uptick in home prices as well. In May 2019, the median sales price for a single-family home in Butte was $145,500. A year later, it was up more than 10% to $160,875.
Jerry Jordan, a broker with Harrison Avenue Realty in Butte, said that while Butte isn’t getting nearly as much attention as other areas, he also has fielded more out-of-state inquiries in recent weeks.
“It’s great for the realtors’ pocketbook,” he said, “but I kind of feel bad for all the locals who are getting priced out.”