While the housing market crash sinks home values around the country, including the Flathead Valley, the Missoula market appears impervious. In fact, according to numbers from the Missoula Organization of Realtors (MOR), home values are actually rising in early 2009.
In the Missoula Urban Area, the year-to-date (Jan. 1 to April 30) median home price stands at $224,500, up from $208,200 in 2008 and $206,000 in 2007.
“From our point of view, things are hoppin’,” says real estate agent Steve Palmer. “In the past 10 days alone, we have put four buyers and one of our listings under contract. We had our third best year ever last year and are on track to match or exceed that level of business this year.”
While prices are up, sales remain significantly down. In Missoula County, 237 homes sold in the first four months of the year, compared to 337 in 2008 and the high of 466 in 2006. But real estate experts say the market can weather the drop.
A one-point drop in interest rates has proven beneficial to home buyers, according to Brint Wahlberg, MOR’s president-elect.
“Purchasing power has increased,” he says, “and that’s helped a lot of people.”
Interestingly, Wahlberg says another factor may be weak condo sales. With the glut of condos and townhouses on the market—198 were for sale as of press time—financing proves challenging because of how the stagnant market affects appraisals and homebuyers’ interest rates. With so few $135,000 condo sales, the median home price skews higher.
“It’s a little tough to sell condos still in Montana because it’s, you know, Montana,” Wahlberg says.
So why is Missoula’s market as resilient as it is?
“It starts with the fact that it wasn’t as over-inflated as many others,” says economist Larry Swanson of the Center for the Rocky Mountain West. “The bubble didn’t really grow to a size that couldn’t be sustained, so the values hold even as activity or sales decrease significantly.”