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Home Prices and Growth: What’s Going On?

by Hart Real Estate Solutions

What Does Growth Look Like Around the U.S.?

It comes as no surprise to many of us that owning a home can be an expensive venture. Factor in HOA fees, interior appliances/materials, miscellaneous maintenance costs and everything in between, and it’s easy to see why being a homeowner can appear to be daunting to some.

Although home prices grew 5.6% last year, this is only determined when comparing dollars to dollars. If this statistic is adjusted for inflation, this increase is still actually 15% below the high that occurred in 2006. Of the country’s 100 largest metro areas, only 41 grew to new peaks, even though 97 of these 100 metro areas did see overall home price growth. Overall, housing markets on both the West and East coasts have experienced inflation-adjusted home price increases of more than 40% in the last 16 years, while markets in the Midwest and South have generally experienced decreases.

However, growth has not been the same across all income levels. After Harvard researchers collected data for more than 9,000 ZIP codes across the country, most home prices in all income brackets were LOWER than their pre-2006 peaks. Here’s the breakdown:

  • Low-income areas: 13.7% lower
  • Moderate-income areas: 6.5% lower
  • High-income areas: 3.3% lower

Because of the post-recession change in home prices, many homeowners were able to emerge from underwater, a term indicating that the value of a home is below or under its mortgage amount. In 2011, the number of underwater homeowners topped out at 12.1 million; by the end of 2016, that number was down to 3.2 million.

                   

Source: PalmBeachPost.com

What About Growth in and Around Bozeman?

Bozeman remains one of the fastest growing small towns in the country, with a population growth rate of 4.6%. Home prices across the state currently exceed pre-2006 levels by 10%.

When comparing median sales prices between Bozeman, Belgrade and other Bozeman areas, home prices are still steadily on the rise in all 3 areas.

 

Median Sales Prices (2011-2017)

This data was pulled Big Sky Country MLS for 2017. While we attempt to provide reliable, useful information, we cannot guarantee that the information is accurate, current or suitable for any particular purpose. Estimates are subject to change without notice.

 

Although median sales prices are continually rising, the good news is that the median sale price is often lower than the median original asking price: 

This data was pulled Big Sky Country MLS for 2017. While we attempt to provide reliable, useful information, we cannot guarantee that the information is accurate, current or suitable for any particular purpose. Estimates are subject to change without notice.

 

As for the country as a whole, Freddie Mac predicts an overall home price increase of 4.9% in 2018. While that may seem like quite a jump, this prediction is still lower than the 6.3% growth we’ve seen so far this year.  Much like the prediction for 2017, 2018’s prediction also suggests continued economic growth of around 2%, steady job gains and relatively low mortgage rates. 


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Gallatin County Leads Montana's Economy

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The Annie and Oak Street Issues: Bozeman’s Second High School Faces New Challenges

by Hart Real Estate Solutions

While the overall design for Bozeman’s 2nd high school has been approved, the actual design drawings will be completed sometime this month, at which time the School Board will take its final vote on the design. Previously, we had learned that the design was modern and sleek, with elements of brickwork, black metal cladding and an all-glass entryway incorporated into the plans. Only small modifications to this design have been made by Building Committee members, which include using traditional red brickwork rather than the originally proposed grey, and using white instead of purple for the triangle outside the main entry.

The Annie Street Issue

City staff members are in favor of the school district building Annie Street east-west, which would cut through the middle of the property where the high school will be constructed. This expense is estimated at $800,000, and would require students to cross a city street in order to reach the playing fields. While the school conducted a traffic study and found that Annie isn’t a heavily used street, the city feels as though building this street is needed for the transportation system.

The Oak Street Issue

While the school had discussed using a portion of the budget to build a soccer field and parking lot on the north side of Oak (across the street from the new school), designers have other plans— building a pedestrian tunnel under Oak Street AND constructing an overpass over the tunnel.

The land north of Oak is city-owned, which means that the plans for a field and parking lot would be a collaborative project with the city’s plans to develop a sports complex. Creating both a tunnel and overpass, while great for ensuring pedestrian safety, present the challenge of meeting the budget.

The goal budget is between $76 million and $78 million, the current design is around $87 million, and once site work, streets and the possible tunnel are factored in, the entire project will cost $93 million.

Future Location of Second High School/Sports Complex

Only Time Will Tell

The Annie Street issue will be discussed as soon as next week, although we aren’t sure when we’ll find out whether the tunnel and overpass project will move forward. Revisiting the budget and cutting costs will likely need to happen before any major decisions are made. Sometime after the new year, however, we can expect to find out more about the new school’s colors, logo and mascot.


Related Articles:

Design Plans for Bozeman's 2nd High School in the Works

Belgrade Expands and Prepares for Future Growth

Long-Debated Black-Olive Project Gets Approved by City Commissioners

New Local Businesses Contribute to Bozeman’s Rapid Growth

by Hart Real Estate Solutions

Bozeman continues to grow, and we aren’t just talking about its population and endless road expansions all over town— new local businesses have been popping up all over town; Evergreen Clothing, Ekam Yoga, Stuffed Crepes and Waffles and Backcountry Burger Bar are just a few of the new businesses that have opened this year. But 2017 isn’t over yet— a new candy shop, new brewery and new diner are either slated to open their doors by year’s end, or have recently done so.

For Those With a Sweet Tooth…

Owner Kimberlee Greenough started Hush Salon in 2011 and has worked as a personal trainer for years, and is now pursuing a lifelong dream of owning her own candy shop. Set to open at the end of October, The Candy Jar will feature more than 500 types of chocolates, gummy candies and other classic candies, as well as a soda fountain and ice cream bar with Wilcoxsin’s and Montana-made syrups. The Candy Jar will be located near Wasabi on West Oak, and an open house on Halloween is currently in the works.

For Those Who Like Locally Crafted Beers…

If candy isn’t your thing, and craft beers are, you’re in luck. Mountains Walking Brewery and Pub opened in late September. Owner Gustav Dose grew up in both Taiwan and Japan, and has studied brewing around the world. His goal with this brewery was to make beers that can’t be made anywhere but Bozeman, taking into account factors such as our climate, altitude and native yeasts. The tap list changes daily, and will still feature familiar favorites in addition to rare finds. Mountains Walking is located on Plum Street on the east end of town.

For Those Who Appreciate Locally Grown Foods…

Opened in September by husband and wife duo Charley Graham and Lauren Reich, Little Star Diner has a menu that changes frequently, as most of the restaurant’s produce is grown by Reich. Depending on the time of year, and with Montana’s short growing season, you may find yourself faced with new menu options based on what’s available at that time. Reich has been growing produce for restaurants since 2009 and Graham was most recently a chef at Blackbird Kitchen. The couple is confident that by combining their culinary experience with the farm-to-table concept, Little Star Diner will soon become a local favorite in town. 

 

New Local Businesses in Bozeman​

Design Plans for Bozeman’s 2nd High School in the Works

by Hart Real Estate Solutions

We already know that Bozeman is quickly growing, and it comes as no surprise to anyone in the area that the high school is becoming overcrowded— just last year nearly 2,000 students were enrolled. With a capacity of 2,400 and a predicted enrollment of 2,700 by 2023, it only makes sense that plans for a 2nd high school are currently underway.

Back in February of 2016, several different scenarios for how to solve this problem were presented, a few of which included ideas for staying on Main Street by expanding the current building. However, it has been decided that the best course of action is to construct a 2nd high school, currently planned to be built on a 57-acre plot bordered by Durston & Cottonwood roads, Flanders Mill and West Oak Street.

What Else?

The latest cost estimate for this project is around $83 million, though it is expected to shrink since it is still in the design phase. The entire budget for the school is targeted at $94 million, with more than $10 million going toward equipment, fixtures and furniture. Some of these costs will also be used to renovate the existing high school to keep up with its rapid growth. CTA Architects Engineers, the firm working on developing the new school, will present its final design plan to the Bozeman School Board this December.

The design that was shown last week is modern and sleek, with some brickwork on the three-story classroom building to channel historic Main Street. Extensive black metal cladding, a wedge-shaped roof, all-glass entry and a two-story, stair-like tiered seating structure are all also currently included in the design plans, though these features are subject to change.

Current Design For 2nd High School

Source: CTA Architects Engineers

It’s Green, Too?

The school will also be constructed to environmental standards specifically tailored to schools instead of LEED building standards, which is the most widely used green building system in the world. Though using CHPS (Collaborative for High Performance Schools standard) will run about $10,000 less than LEED, the school chose these standards because it has many of the same features and is more geared toward K-12 schools.

The design report  that was approved by the school board earlier this month contains a CHPS checklist (pages 25 and 118), which demonstrates how the new school will aim to earn 125 environmental points. Many of these points will be earned for its energy efficiency, acoustics, water use regulation and heating system, in addition to sharing the building with other community groups after school.

Pros and Cons

Though we aren’t sure yet when construction will begin, the new school would create more opportunities for students to join sports teams and enroll in special classes like AP and foreign languages.  On the other hand, additional costs for building upkeep, hiring staff and another principal, and funding for double the number of sports teams is generating concerns from both parents and the School Board. Though there are still many details to be worked out over the coming years, one thing is for certain— Bozeman is still rapidly growing, and addressing the soon-to-be overcrowded high school now rather than down the road seems to be the best course of action.


Related Articles: 

Belgrade Expands and Prepares For Future Growth

Bozeman Continues to Grow With New Proposed Airport Expansion

Bozeman Ranks Second as the Fastest Growing Small Town in America

Bozeman Continues To Grow With New Proposed Airport Expansion

by Hart Real Estate Solutions

It comes as no surprise to most of us that Bozeman is quickly growing, in terms of both population and city development. In the past seven years alone, we’ve grown from 37,000 residents to more than 45,000. Last year was a record year for the Bozeman Yellowstone International Airport, which is located in Belgrade and is the busiest airport in the state— there was an 8.4% increase in the number of travelers in and out of Bozeman, and 29% of all air travelers in and out of Montana fly through the Bozeman airport.

To better accommodate those flying in and out of Bozeman, plans to develop more than 50 acres of land south of the airport have been submitted. These plans include a mixed-use complex that will hold hotels, retail stores and restaurants. A Connecticut-based developer, Charter Realty & Development, is currently in negotiations to purchase the property from its current owner Knife River, a construction materials company headquartered in Bismarck, ND. 


With both the number of new listings and pending sales increasing in Belgrade, this development may also be beneficial to Belgrade residents and those looking to relocate to the area.

While the median sales price for Belgrade sat at $279,900 last month, this is still lower than that of Bozeman, with its median sales price hovering around $369K. Dan Zelson, a principal with Charter Realty, states that with growth coming out of Bozeman and into Belgrade, long-term plans may include residential buildings. While this isn’t part of the current proposal, this development could take place as soon as next year, with its first tenants moving in by 2019.

The plan will be presented to the Belgrade City Council on September 18th. Whether or not lower median sales prices are encouraging some Bozeman residents to relocate to Belgrade, the area is indeed expanding and will likely continue to do so with such a busy airport nearby that continues to set new passenger records every year, as well as with the high population growth rates we’ve been experiencing in recent years. 


Related Articles: 

Black-Olive Proposal Denied by Bozeman City Commissioners

Bozeman's 4th Mid-Rise Building Proposed to Replace and Old Grain Mill

Bozeman Ranks Second as the Fastest Growing Small Town in America

Bozeman Airport Expands for Explosive Traffic Growth

by Hart Real Estate Solutions

As you may have notice, the Bozeman area has been growing exponentially with each passing year, and the local airport is certainly feeling it. Our Bozeman Yellowstone International Airport just broke its own traffic records for the seventh year in a row. While the U.S Census Bureau estimated there was only 100,000 residents living in Gallatin County in 2015, the airport handled a staggering 1.1 million passengers the following year. That’s 10 times more passengers moving through the airport than there is people living in our area! 

To accommodate for the growing traffic, the airport is working on adding another runway and considering to add some new gates. American Airlines also just announced that starting this spring, they will be making non-stop daily, seasonal flights to and from Bozeman and Dallas-Fort Worth. The airline will have a summer service running from June 2 to October, and a winter service running from December 15 to April.

With Bozeman being a college town, and Big Sky and The Yellowstone National Park being major tourist attractions, it’s no surprise that the airport’s been so busy. College students fly home during the holidays, Yellowstone National Park has tourists flying in from all over the world in summer, and our world-class ski resorts attract skiers in the winter. These local attractions keep the airport busy all year long.

Good business for the airport is also good business for our community. With an expanding airport, it will draw in more potential customers for our local businesses, add jobs and revenue to our community, and possibly lower flight costs from Bozeman to global destinations.


Related Articles:

Development Projects In Downtown Bozeman

Business Success In Bozeman

Job Growth In Gallatin County



Read more about this topic:

Bozeman airport again breaks record for passenger numbers

American Airlines enters Montana market, offers seasonal service to Bozeman

Mid-Rise Buildings to Doom Bozeman's Small-Town Charm?

by Hart Real Estate Solutions

 

There has been rising controversy in downtown Bozeman over development plans for mid-rise buildings in the heart of the city. City commissioners will soon make the decision whether to approve developer Andy Holloran’s proposal for his Black-Olive project, which will transform the south-east corner of Black and Olive Avenue into a three-story building with 56 apartments. 

Black-Olive Project(3-story building on black-olive avenue as of December 28, 2016 that the new apartment building is planned to replace.)

With the Element Hotel now built, the 5-West building already standing, and the Clark Hotel’s expansion underway, downtown residents are concerned that the Black Olive proposal is the breaking point that ushers “the final doom of Bozeman’s small-town charm.” Most members of the “Save Bozeman” effort are not entirely against development, but what they want is “balanced growth that benefits everybody, and not just developers.”


 

5 West Downtown Development

(5 West Project on Mendenhall Street under construction as of December 28, 2016.)

Several concerned residents have responded with the “Save Bozeman” effort. They made a Facebook page to coordinate their efforts and inform other residents about issues facing the community, and you might have noticed their yellow yard signs popping up around downtown neighborhoods. Stewart Mitchell, one of several coordinators behind the “Save Bozeman” effort, says their goal is to draw more members of the community into the city’s planning process.

What About The Housing Shortage?


To counter the opposition, there are some benefits of denser developments that may make the case for the Black Olive project. People want our Bozeman lifestyle, which can be credited for much of the county’s explosive growth in recent years. Unfortunately, with rising demand, comes rising prices. Housing inventory is being stripped away, and prices are climbing at such a rate that it may finally slow our city’s growth.

Having these apartment buildings spring up downtown may help to address our current housing shortage issue. More apartments will loosen up the market for renters, and keep prices within a reasonable reach. Even luxury, higher-end apartments may improve housing affordability. When luxury options are limited, wealthier renters may have to settle for mid-market options, and outbid lower-income residents who can’t compete. By meeting the demand for high-end housing, affordable housing would be left alone and made available for families who truly need them.

Another proposition to be made is that denser development may help preserve Montana’s countryside. Even if we build a financial wall around Bozeman, development would likely spread to outlying areas, encroaching further into the untouched territory that we value about Montana. “Building” up may be the alternative to “building out” with residential neighborhoods, like we’re seeing in the development of Bozeman’s west side.

State Your Opinion


There are many arguments to made on either side of this issue. Mid-rise developments will transform the city’s core, and may alter the course of the city going forward. The community deserves a fair debate over this matter. For those that are concerned and want to be more involved with the community, be sure to attend the city’s Community Forums held at the City Hall to state your opinions.


Related Article:

Development Projects In Downtown Bozeman


Source:

Saving Bozeman: There’s a generational divide on development in the heart of the city

Business Success In Bozeman

by Hart Real Estate Solutions

It is exciting to see so many successful businesses in our community. For the third consecutive year in a row, The Partners Group has been named among the top 75 Best Places to Work in Insurance nationwide. This company has a number of offices across the Northwest, including one here in Bozeman, Montana.  It is great to see so many admired companies laying foundations in Bozeman.

Along with the Partners Group,  RightNow Technologies (bought by Oracle), Elixiter, Wisetail, Zoot Enterpises, Simms, and a number of other large companies are growing in the area.  Our economy is strong. These local businesses are contributing to Montana’s superior economic performance.


With such growth of jobs and businesses in our city, Gallatin County’s unemployment rate dropped to 2.3% in August 2016, the lowest unemployment rate in Montana. 


In 2015, Montana lead the nation in entrepreneurship, with its number of business openings accounting for 7.4% of the total existing business.

There is some mighty potential for our small town. Apparently, Montana isn’t just about being a fun and beautiful place to live in, it’s a great place to start a career as well. With the real estate market booming, it’s a great time to buy a house here in Southwest Montana if you’ve been considering it. See our listings, or contact us today and together we’ll find that perfect home you’ve been looking for.

September 2016 Real Estate Market Report

by Hart Real Estate Solutions

The Gallatin County real estate market is still growing strong. According to the Gallatin Association of REALTORS®, both average sales volume and total sale price has shown significant growth through September 2015 to September this year.

The increase in average real estate price from $358,997 last year to $460,957 this year, estimates an astounding 36% housing appreciation. Average sales volume has also seen substantial growth by 30% in this area.

These numbers demonstrate positive implications that the Gallatin area is steadily climbing in the real estate market. As the GAR President stated, “our local market is in strong shape.”

The statistics comparison between September 2016 and 2015 are as follows:

Residential Sales-Units:

  • September 2015: 226
  • September 2016: 217

Residential Sales- Average Sales Price

  • September 2015: $339,194
  • September 2016: $460,957

Residential Sales- Total Sales Volume

  • September 2015: $76,657,952
  • September 2016: $100,027,807 

Bozeman Montana Commissioners Approve City Budget

by Hart Real Estate Solutions


Commissioners have been debating the city’s budget, discussing where spending needs to increase and by how much. Bozeman Montana is one of the fastest growing towns in the nation, so commissioners did not consider lowering the budget, but rather trimming back on possible spending increases.

Commissioners had debated several budgets, with City Manager’s Chris Kukulski’s budget dominating the conversation. Kukulski called for major investments in infrastructure, while also addressing issues created by Bozeman’s population and economic growth. If adopted in total, this budget would have increased a typical Bozeman resident’s city fees by 5.5 percent.

In Kukulski’s budget, the average Bozeman resident would see their taxes increase by $114 per year. Infrastructure spending would take $72 of the yearly tax increase per resident. The fees would fund deferred maintenance as well as street creation and maintenance in new Bozeman neighborhoods.

An alternative budget reduced the increase to $80 per year, representing a 3.9% total increase. However, this plan required cuts in both planning studies and affordable housing efforts, both topics that have been high on the Bozeman’s list of priorities.

The city ultimately decided to approve a budget closer to Kukulski’s budget, but with additional cuts, representing a middle area between the two proposed budgets. They city approved the new budget with a 3-2 vote. Bozeman Commissioners passed on several new hires and a few planning initiatives to cut an additional half million from the budget. They did add some spending in a few places, including the Bozeman Public Library’s new mobile library, the bookmobile.

The approved budget will add $92 a year to a Bozeman resident’s lifestyle. Total yearly costs per resident have increased to $1,148 per year. The 4.5% increase fell between Kukulski’s budget (5.5 percent increase) and the alternative budget (3.9 percent increase). Homeowners can expect to see a $1.32 increase in their property taxes.

Sources: http://www.bozemandailychronicle.com/news/city/bozeman-budget-passes-on-a-split-vote-as-commissioners-spar/article_fe577606-0987-5ec5-9127-3c4303a0dd65.html

http://www.bozemandailychronicle.com/news/city/bozeman-city-commission-debating-budget-tax-increases-monday-night/article_b337d1b8-0451-53ce-b795-c93180feddb5.html

http://www.bozemandailychronicle.com/blogs/city/getting-a-handle-on-bozeman-s-budget/article_8ebe8f60-6dde-56e8-929d-8756366b8241.html

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