The Great Falls housing market picked up during the first half of 2014 in two major indicators — number of sales and median sales price — but there are considerably fewer houses listed for sale, real estate officials say.
“Sales for single-family homes were 3 percent stronger for the first six months of 2014 than for the same period last year, with 328 sold through June 30 of this year compared with 318 at that point last year, and the median sales price also increased nearly 1 percent, ” said John Kunz, president of the Great Falls Association of Realtors and owner-broker of Coldwell Banker The Falls.
Two of Montana’s other eight major housing markets experienced gains during the first half of 2014, according to figures from the Montana Association of Realtors.
Butte led the way with an 11.7 percent gain in home sales, while Gallatin County had a 5.2 percent gain. Bitterroot Valley sales dropped 3.8 percent, Billings sales dropped 7.9 percent, northwest Montana sales dropped 11.6 percent, Helena sales dropped 11.7 percent and Missoula sales dropped 15.6 percent, MAR statistics show.
“Our Great Falls housing market has always been very solid and steady,” Kunz said. “The atmosphere has been particularly positive so far this year, probably spurred by job growth led by the Great Falls Development Authority.”
In Great Falls in the first half of 2014:
• The median price of homes sold increased from $158,500 during the first six months of 2013 to $160,050 during the same period this year. “That’s an increase of just under 1 percent, but it’s heading in the right direction,” Kunz said.
• Great Falls houses remained on the market longer so far this year than during the same time last year, an average of 123 days during the first half of 2014 compared with 118 days during the same period last year, a 4 percent increase.
• The number of single family homes being listed for sale in Great Falls as of June 30 fell considerably, Kunz said.
There were 300 single family homes listed for sale at the end of June, a drop of 37 percent from the 478 listed on June 30, 2013.
That’s the lowest early summer inventory of houses on the market in the five years for which the Great Falls Association of Realtors has data, Kunz said. There were 505 houses on the market on June 30, 2009, during the heart of the Recession, 493 in 2010, 443 in 2011 and 475 in 2012.
“My gut feeling is we’ve got one of the lowest housing inventory numbers that I’ve seen in 20 years working in Great Falls real estate,” Kunz said.
He attributed the smaller number of houses to job growth in the Great Falls economy such as the ADF Group steel assembly plant and the Blue Cross Blue Shield provider service center.
Great Falls Development Authority President Brett Doney said the Great Falls metro area had its labor force grow 2.5 percent, adding 1,035 people so far in 2014, and its employment grow 3.2 percent, adding 1,262 jobs.
Kunz said he expects new home construction to continue to pick up if business and job growth continues.
Statistics from the Great Falls City Planning Department show contractors obtained 32 permits to build single-family residences in Great Falls in the first half of 2014, an increase over the 28 permits issued in the first half of 2013.
Julie Topel-Evans, a sales associate with Kunz at Coldwell Banker, said there could be another factor keeping the inventory of sales homes down.
Interest rates on conventional mortgages climbed to 4.25 percent, she said, and that could spur some homeowners who refinanced their existing mortgages in recent years at 3 percent to hang onto their homes and possibly remodel rather than building or buying a new home at a higher interest rate.
Demand for homes varies by price range.
The strongest portion of the Great Falls market is for houses in the $150,000 to $200,000 range, Kunz said, with 98 houses sold in this price range during the first six months of this year and 100 in the same period of 2013.
“It’s a very competitive part of the market, so if families find a home they like in this price range, they need to make a bid fairly quickly, because they might lose the house to another buyer if they drag their feet.”
There also is a good demand for Great Falls houses in the $100,000 to $150,000 range, with 92 sales in that range during the first half of 2014. Often first time buyers look for the more affordable houses in this price range, Kunz said. Others buy older houses in this range and fix them up to resell for a profit, he added.
There also have been fairly sizable sales during the first half of 2014 of houses in the $200,000 to $250,000 range, 37 homes, and the $250,000 to $300,000 range, 31 units, he said.
However, there are fewer houses available and less demand in the Great Falls market for houses selling for more than $300,000, he said. There were just 17 such sales during the first half of 2014 for prices in the $300,000 to $350,000 price range.
Some buyers interesting in more expensive homes may opt to build a custom home that fits their personal home design and décor ideas, Kunz said.