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Fall's Entrance in Montana
September 2009
 Time
to Buy - Time to Sell (or wait)
Why Buy?
It's about your Life, not hunting for the bottom!
For every reason to buy there is a reason not to buy.
When you cut through all the reasons to be confident or
afraid, it's not the interest rates or market indicators
that are the keys, the key is living the life you've
imagined.
This is your Life!
The lake, the mountains, the sunrises, sunsets, skiing,
golfing, riding, fishing, boating, floating, hiking and
biking, these things are as good now as they were at the
"height of the market." Too much space, not enough
space? Too many neighbors, not enough neighbors? Too
much grass, not enough grass? Is it worth worrying about
market nuances when life is ready to be lived today?
Where's the Bottom?
And a word about the ever elusive "market bottom". The
author of an article on a Broker Networking site hits
the nail right on the head, "Did you buy a hundred
thousand dollars worth of stocks on March 5th? If you
did, you probably would have turned $100k into $300k
pretty easily. What's that? You didn't buy on March 5th?
But that was the bottom! Why on Earth didn't you buy?"
(Source: Why Buy? D. Curry, Broker Agent Social,
8.11.09)
Why Sell?
Now may not be the time for you!
Basic Economics are at clearly at play in our market.
When Supply exceeds Demand there is an Excess Supply at
the current price. Price must change before the market
will return to equilibrium.
Surplus of property on the market
Inventory is too high in the Flathead Valley for prices
to begin the climb up from the "bottom". The current
market is cluttered with overpriced and distressed
properties leaving buyers feeling no sense of urgency
and lacking in confidence as to what a property is
'worth'. We won't see a true recovery to a 'normal'
market as long as REO and short sale properties dominate
the sales statistics. At some point, prices will adjust
and buyer's return will signal the recovery is underway.
The MLS report for current Listing Activity and
Inventory in comparison to the "top" of the market in
2006:
| |
New |
Active |
Sold |
Months
Inventory |
| Aug 2009 |
694 |
8108 |
179 |
45.30
(3.76 years) |
| Aug 2006 |
967 |
4952 |
429 |
11.54 |
| June 2006 |
1104 |
4352 |
500 |
8.70 |
|
*Source: NMAR
MLS 9.4.09 |
Shortage of Buyers in the market
Buyers in our market this summer have been very vocal
about their choices. Other markets - Bend, Jackson Hole,
Boulder, Southwest MT, Sandpoint, Lake Tahoe - are in
competition with the Flathead Valley for resort and
recreation buyers. While the competition is not new,
buyers are responding to changes in prices in other
markets. In general, people are more likely to buy
something if it is cheaper. If buying in the Flathead
remains more costly, then buyers will continue to
explore these other choices.
Dramatic
Reduction of Sales Volume reflected in MLS Data:
Since 2006 the
market sold volume is down 72%
January 1 through September 22, 2009 Sold Volume is
21.15% of 2006 Sold Volume or less than ¼ of volume
sold in 2006.
January 1 through September 22, 2009 Number Sold is
24.33% of 2005 Number Sold and 26.01% of 2006 Number
Sold.
| Year over Year
Comparison |
Number
Sold* |
Sold
Volume^ |
Average
Sale Price** |
| 1/1/05-12/31/05 |
4321 |
$1,091,241,827.00 |
|
| 1/1/06-12/31/06 |
4041 |
$1,200,801,325.00
up 10% from 2005
|
Up 18% from 2005 |
| 1/1/07-12/31/07 |
2963 |
$925,252,199.00
down 23 % from 2006
|
Up 5% from 2006 |
| 1/1/08-12/31/08 |
1935 |
$567,750,373
down 39% from
2007
|
Down 6% from 2007 |
| 1/1/09-9/22/09 |
1051 |
$253,979,969
down 43% for
same period in 2008
|
Down 17% from 2008 (23% total min decrease) |
2008 vs
2005: 1935 vs 4321 down 55.2%
$1,091,243,827 vs 567,750,373 down 58%
2008 vs 2006 1935 vs 4041 down 52%
$1,200,801,322 vs 567,750,373 down 62.7 %
*Number Sold is the number of listed properties that
sold
^Sold Volume is the total dollar amount of the number
sold
**Average Sale price is Sold Volume divided by Number
Sold
SOURCE: NMAR MLS 9.22.09
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Northwest Montana Real Estate
love montana. live montana.TM
