Bozeman Real Estate Blog

Affordable Housing in Bozeman

Affordable Housing in Bozeman


Affordable housing is a hot topic right now, not just in Bozeman, but nationwide. With low mortgage rates, demand is high for housing, especially with first time home buyers.  The low supply of housing available is driving prices up. With the rapid growth Bozeman has been dealing with over the past several years, this imbalance is even more pronounced.  The city commission agrees that affordable housing in our community is the #1 priority, but tackling Bozeman's affordable housing issue comes with challenges. 

What is causing the affordability problems

It’s not just one thing creating affordability problems. The number of people moving to Bozeman, the high cost of land and construction, out of state money, and lack of inventory is all adding to Bozeman's affordable housing issues. The median sales price of a land lot in Bozeman is $165,000, which makes it difficult for a builder or developer to build an affordable home. The popularity of people moving to small, mountain towns isn’t going to slow down and this influx of population certainly drives prices up. Gallatin County is the fastest-growing county in Montana and Bozeman is the fastest growing city of its size in the U.S. Many people new to Bozeman are coming from larger metropolitan areas and Bozeman home prices seem like a bargain in comparison. With the increase of people working remotely, people can continue to make high wages and afford Bozeman real estate prices. This makes it hard for people living and working in Bozeman, especially when wages in Bozeman are well below national averages. Click here to read our post on 10 ways Bozeman has changed in the last 10 years.

 

HRDC Affordable Housing Projects

The Human Resource Development Council has been serving the Gallatin County since 1975 and has been working hard to come up with solutions to the affordability issues in Bozeman. Their latest project, the Willow Springs Townhomes is one of the ways they are doing this. The first phase of the project is currently underway, with 12 units in the northwest area of Bozeman. The Willow Springs Townhomes offer 2 and 3 bedroom options with attached single car garages and yard space. These will be 100% owner-occupied while the land they are on is owned by the Community Land Trust. This ensures the home buyers build equity in the home and it becomes a stepping stone for them to get into the housing market. In order to get on the waitlist for these units, you need to fill out an application through HRDC and take their HUD-certified homebuyer education course. All of this can be found on their website. The second phase of Willow Springs will have an additional 12 units. There are other affordable housing projects in the future, however, HRDC helps the community in many different facets and currently, the warming shelter has taken some of the priority. HRDC can also offer information and guidance for first-time homebuyers, down payment assistance programs, housing first initiatives and foreclosure intervention. They manage over 300 affordable housing units and are actively helping so many people in our Bozeman community. 

The Bridger View Redevelopment is another HRDC project coming up in the future near the Story Mill Community Park. Half of the units will be part of the Community Land Trust, similar to Willow Springs Townhomes where qualified buyers will own the unit. More information on this should be coming soon. 

 

Other Projects

If a developer is building more than ten units in a subdivision, 10% of them are required to be affordable, or they can pay cash in lieu which then goes back into affordable housing programs in Bozeman. This is a small piece to helping the affordability issue, however, most developers pay the cash in lieu rather than build the percentage of affordable homes.  In the upcoming phase 4 of Allison subdivision, the developer has chosen the first route and will be building affordable townhomes. The south side location near Morning Star elementary is very desirable, making this an exciting opportunity. This is similar to a previous developer who built in the Lakes at Valley West. Four of the townhomes were affordable and the homeowners were from HRDC’s huge pool of qualified candidates. Getting more developers on board with this could be a win for the community.

 

Condo and Townhouse Options

With the median sales price of a single-family home in Bozeman hovering at $490,000, most affordable options are condos or townhomes where the median sale price is between $315,000-$365,000.*  The downside is the inventory for homes in this price range is incredibly low, making it very competitive. There are many new condo projects coming up in Bozeman, both coming on the market for sale and as rentals, but currently, we are in a waiting period for the supply and demand to balance out, especially in these price ranges. 

The CentrePark Flats are a new development that has just started listing units for sale. They are located behind Home Depot, backing to Rose Park and prices are starting at $285,000. Talbach House is more established condo building on the south side of Bozeman and it often has units come up for sale. They are usually listed under $300,000 and offer amenities such as an on-site gym and high-end finishes. The Bronzeleaf Condos are in the northwest part of town, across the street from Meadowlark elementary school and near the new high school. They have covered carports and storage closets and usually come on the market listed under $250,000.

 

The Surrounding Areas

When Bozeman home prices started taking off, Belgrade became an affordable alternative to Bozeman. However, Belgrade home prices have been increasing at a faster rate than Bozeman for the past two years so they are quickly catching up. That being said, the average sale price of a single-family home in Belgrade is 33% lower than Bozeman* so it is still an option many people consider when buying a home. It is also where builders are heading because there are fewer regulations, fees, and hurdles when it comes to development. Beyond Belgrade, people are looking to Manhattan, Three Forks, and Livingston as alternatives to living in Bozeman. While Manhattan is a great small community, the housing inventory is low, home prices are not far behind Bozeman's, and they have had recent tax increases due to new schools being built. Three Forks and Livingston are also great options, but it’s important to keep in mind the extra cost of gas when commuting. Click here for our guide to moving to Belgrade, and click here for our guide to moving to Livingston

 

What Can We Do?

Recently the downtown Boulevard Apartments building was sold to HRDC so it could remain affordable for those who need it. Bob Rasmus, the owner, bought the building 24 years ago and continued to rent the 41 units to people who were struggling to find housing. This property is highly desirable and he had several high price offers but chose to sell to the nonprofit. This was a win for the community and a stark difference from what’s happening to the Lovelace building on Main Street. This building recently went under contract and all residential tenants received eviction notices so that the building can be turned into luxury offices. We are so thankful for people like Mr. Rasmus who are making a difference in Bozeman's affordability problems.

There is no easy answer to the affordable housing struggle in Bozeman. Being involved in what is happening in local politics is important because this is where many decisions regarding housing affordability happen. Going to city commission meetings and being involved is an important part of making changes in Bozeman's affordable housing problems. Looking for opportunities to be a part of programs such as the Community Affordable Housing Action Board and volunteering through HRDC to help those struggling with the high cost of living is also a great way to make an impact. Even simpler than that, is keeping our money local. Shop the small businesses in Bozeman rather than the big box stores to support our neighbors and friends. Help continue the strong sense of community Bozeman has by being involved and helping each other out. Housing affordability will not be an overnight fix, but we don't want Bozeman to lose the locals and sense of community that make it such a wonderful place.

We recently sat down with Noel Seeburg, a local real estate agent and board member on the Community Affordable Housing Action Board.  We talk with him about what affordable housing looks like in Bozeman. Click here to listen on Spotify or click here to listen on iTunes.  

*Gallatin Association of Realtors, InfoSparks

MORE POSTS


EMAIL 406.587.1717