No peak in sight for Flathead real estate sales

Up.

If it had anything to do with real estate in Northwest Montana last year, it was up.

The number of homes sold … up across the board. Median prices … up. High-end sales … up. Total sales … up.

A record $867.1 million in real estate changed hands in Northwest Montana in 2004, shattering the previous record by more than 30 percent, according to figures released last week by the Northwest Montana Association of Realtors, which tracks sales in Flathead County and portions of Lake, Lincoln and Sanders counties.

Residential sales alone topped $587 million, a 37 percent increase from 2003. The number of homes sold increased 13 percent, to 2,237.

These numbers include a few newly built homes, but they don't include the bulk of the record 1,136 new single-family homes that were constructed in Flathead County in 2004. The Montana Building Industry Association estimated that the combined value of those structures was $260 million.

"A year ago I told a friend that we were close to over-building and over-pricing," said Doug Denmark at RE/MAX Glacier Country in Kalispell. "I've since recanted. Compared to other areas, we're still a good deal."

Denmark said one of the agents in his office recently dealt with a couple from Washington who wanted to buy some land and a medium-size home here. They found a nice place and asked what the annual property taxes would be. The agent cringed and said the bill would be about $6,000.

"They just smiled," Denmark recalled. "They were paying $30,000 in Washington."

At an economic outlook seminar in January, Glacier Bank Executive Vice President Dennis Beams noted that waterfront property was selling for $45,000 per front foot in the Seattle area, compared to $8,000 along Flathead Lake.

"Outsiders think the Flathead Valley is an incredible value," he said.

That's helping drive real estate sales here, but Denmark said he's afraid local residents are getting priced out of the market.

"That's probably the biggest fear Realtors in the valley have," he said. "It's getting harder and harder for people who were born and raised in the Flathead to buy homes here."

Less than 20 percent of all the homes sold in Northwest Montana last year were priced below $120,000. Almost a quarter were priced at $300,000 or more. The median price was $179,000, meaning half sold for more than that amount and half sold for less. That was a 13 percent increase from the previous year, and it's up 46 percent since 2000.

Columbia Falls continued to be the least expensive community in the valley, with a median price of $148,000, up almost 18 percent from 2003.

Kalispell was the hottest market, with 826 home sales or almost 40 percent of the total unit sales volume for the region. The median price was $169,000.

Bigfork, Lakeside/Somers and Whitefish remained the most expensive home markets in the valley. All had median prices well in excess of $200,000 in 2004, largely due to the number of high-end home sales.

In Whitefish, for example, just 63 transactions - out of 328 individual sales - generated $63.9 million, or half of the area's $128 million in total residential sales.

"Some of us old-timers started forecasting a few years ago that this can't go on," said Denmark, who's been selling real estate since 1981.

"But we're starting to realize that it can. There are out-of-state people buying homes here over the phone. We spend a lot of time with customers and we ask them why they're coming, why they're buying. They say it's because they're afraid it will all get bought up and there won't be any left."

Reporter Bill Spence may be reached at 758-4459 or by e-mail at bspence@dailyinterlake.com