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 2017 sales by lot size. Of the 1,884 residential sales in 2017, 42 percent were on lots that were smaller than a half an acre. At this time there are 709 residential listings and only 22 percent are on similar sized lots. With 783 sales on small lots and a current inventory of 155 listings, this means that there is currently around two months of inventory for non-waterfront homes on small lots. These homes on small lots had a median price of $244,500, which is below the overall median of $275,000 in Flathead County.
As we move to homes on five to 10-acre tracts, we find that they account for 7 percent of the sales and 8 percent of the current listings. With 124 sales in the last year and 60 current listings, this tells us that there is currently around six months inventory of homes on five to 10 acres. These homes had a median sales price in the last year of $395,000, compared to $360,000 in 2016.
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 is for homes on lots that are smaller than three acres, with no water frontage. These homes account for 81 percent of the sales and currently have three months of inventory. These homes had a median sales price in the last year of $262,500, compared to $233,000 in 2016. 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 that are on the market and have sold are unlikely to sell. Properties that are overpriced become shopworn to a point that buyers won’t even look at them and when they do sell, it is often at a price that is below the rest of the market. This is because 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.