Last week, I broke down the Flathead County housing market based on price distribution, so this week I’ve broken it down based on lot size.
This graph shows the distribution of current listings and the 2016 sales by lot size. Of the 1,680 residential sales in 2016, 51 percent were on lots that were smaller than half an acre. At this time there are 851 residential listings and only 26 percent are on similar sized lots. With 861 sales on small lots and a current inventory of 221 listings, this means that there is currently around three months of inventory for non-waterfront homes on small lots. These homes on small lots had a median price of $220,000, which is below the overall median of $255,000 in Flathead County.
As we move to homes on 5- to 10-acre tracts, we find that they account for 7 percent of the sales and 8 percent of the current listings. With 119 sales in the last year and 65 current listings, this tells us that there is currently around seven months inventory of homes on 5 to 10acres. These homes had a median sales price in the last year of $360,000, compared to $350,000 in 2015.
Waterfront homes accounted for 4 percent of the sales in 2016, but make up 14 percent of the current listings, with 20 months of inventory that is on the market. In the last year, these homes had a median sales price of $590,000 and those that did sell were typically on the market for approximately nine months.
The most active segment of the market are for homes on lots that are smaller than three acres, with no water frontage. These homes account for 80 percent of the sales and currently have four months of inventory. These homes had a median sales price in the last year of $233,000, compared to $220,000 in 2015. The median marketing time for these homes was around 2.8 months.
Regardless of the type or lot size of the property, price is a key factor. Properties that are listed at prices that are not competitive with other homes on the market that have sold, are unlikely to sell. Properties that are overpriced become shopworn to a point that buyers won’t look at them and when they do sell, it is often at a price that is below the rest of the market. Market participants have concluded that if it hadn’t already sold after an extended time on the market, then there must be something wrong with the property and only make offers that reflect that discount.