The Flathead County housing market experienced a rare uptick in sales during October and November, a slight respite after months of dismal numbers resulting from the crash earlier in the recession.
Recent reports from the Northwest Montana Association of Realtors and the Montana Building Industry Association showed housing sales and new housing project numbers are recovering. The numbers are still low compared to the boom years earlier in the decade, but it is still a bit of good news, officials said.
NMAR Executive Director Kathleen Schulte reported higher housing sales and attributed much of the increase to the first-time homebuyers tax credit implemented by the federal government. The $8,000 tax credit was set to expire at the end of November, but Congress extended it until April.
In Flathead County, 147 houses sold in October 2009 compared to 124 the previous year. November numbers showed market progress as well – 106 houses sold this year compared to only 56 in 2008.
Dale Crosby-Newman, broker and owner of West Venture Properties in Kalispell and president of the multiple listing service for NMAR, said the housing increases should be kept in perspective. The market crashed in October 2008, Crosby-Newman said, and everything seized for about six months.
This caused a glut of houses, a flood in a usually tight market, he said. Now, with the tax credit, houses under $200,000 are beginning to sell again.
“I think (the tax credit) helps for sure. That segment of market is by far the busiest and most active,” Crosby-Newman said.
There is still a large supply of houses under $200,000 even with the sale increases his company has experienced, a situation that would have been almost unthinkable in 2007, he added.
New housing starts in Flathead County are also on the increase, according to the MBIA. From January to March 2009, new starts on single-family housing units came it at just 50, half the number from the previous year. From April to June 2009, there were 107 new starts, compared to 187 in 2008. And from July to September 2009, there were 119 new starts. The same time period in 2008 saw 190.
Though the numbers are much lower than even a year ago, an increase to 119 units in three months from 50 at the beginning of the year is a positive sign, according to Flathead Building Association Executive Officer Katie Chamberlain.
“I do see an upward trend, pretty much,” Chamberlain said.
These numbers should also be viewed in perspective of previous years, Chamberlain said. There were three years of steady, unparalleled growth, she said, and now Montana and the rest of the nation are in one of the biggest slumps ever recorded.
“This is definitely one of the larger slumps the housing market has been in, but I do think we will come out of it as we always have,” Chamberlain said.
The housing industry is certainly important to the timber and construction markets, both major employers in the Flathead. But a large number of employees at title companies, banks and real estate companies are affected by market trends as well.
At Sterling Title Services in Kalispell, Vice President Jeff Weyh said October and November were good months when compared to last year. He said they have seen a larger percentage of sales since the tax credit was introduced, and hopes that the new $6,500 tax credit for owners who have lived in their houses for at least five consecutive years will spur activity as well.
Business is still nothing like it was five years ago, Weyh said, but the 2009 market seems to be stabilizing and strengthening.
“I don’t want to see 2008 again,” Weyh said. “2008 was brutal.”
Though many in the housing industry are cautious to extrapolate on spring numbers, especially with the tax credit deadline looming in April, there is hope the recent upswing will carry through.
“I think it’s truly going to depend on what the national economy does. If we keep crawling out of the recession, we’ll come right out with it,” Crosby-Newman said.