Where is the limit?
With the average sale price of a home in Bozeman now over $450,000, home prices in Bozeman are at an all-time high. While homes are selling faster than ever, one has to wonder how far Bozeman buyers are willing to go. In light of Bozeman's strong real estate market, sellers are feeling confident about pricing their home’s above market value, yet they are seeing a push back from buyers. We still see a consistent number of price reductions throughout the city, proving that in most cases, Bozeman buyers are unwilling to go above reasonable market value to purchase a home.
There are plenty of buyers, but limited inventory.
While Bozeman’s population is increasing by more than 4% each year, the number of homes for sale in Bozeman has decreased 38% over the last six years. It’s not hard to imagine how this has changed the landscape of real estate in Bozeman. While builders are pushing to keep up with the demand for new construction, the number of lots available are limited and the price of land is high. As of July, 2018 there were only two single family homes on the market in Bozeman under $350,000, making Bozeman’s real estate market difficult for many home buyers to navigate.
Buyers are competitive.
According to the Big Sky Country MLS, homes sold in Bozeman have been selling for an average of 99% of the homes listing price. In certain areas of Bozeman, homes are seeing multiple offers, often above asking price. The number of days a home spends on the market has dropped significantly in the last six months, reaching a record low of 54 days on the market. In Bozeman’s current market, homes are moving quickly and buyers are facing stiff competition when purchasing a home.
The surrounding areas are becoming more popular.
As home prices in Bozeman reach record highs, many homebuyers are finding that it is simply not an option for them to buy a home in Bozeman. Luckily, the Gallatin Valley is wide and the areas surrounding Bozeman offer significantly lower home prices. Just 11 miles from Bozeman, the average price of a home in Belgrade, Montana is just $305,770, but that price has increased more than 75% in the last six years. It’s a similar story in Livingston, Manhattan and Three Forks. Livingston was recently one of the top 5 places in America to buy a vacation home, which has people wondering if it is going to become the “Next Bozeman”.
Still going strong.
While Bozeman’s current real estate market may feel reminiscent of the ’05-’06 housing bubble, this time around the strength of Bozeman’s real estate market seems to be here to stay. The market is no longer built on high-risk loans but on qualified buyers. Interest rates are stable, buyer demand is high and inventory is low. Consumer behavior has changed as technology allows people to be location independent and many people are drawn to Bozeman for its access to the outdoors and overall quality of life.