Like a weatherman reading a radar, longtime property manager Peter Burkett can see what passes through his office in Kalispell and give a forecast of rental trends in the Flathead Valley.
This year, just as late summer brings a surge in rental activity, Burkett and other property managers are taking note of how the prolonged economic lull continues to affect their market. Factors such as weather are making an impact too.
For example, Burkett, owner of All Pro Flathead Property Management, said a combination of high gas prices and cold, long winters are bringing people closer to town to live.
Residents in Flathead County spend an average of roughly 18 minutes traveling from home to work, slightly above the state average, according to U.S. Census data.
“Last winter being a pretty tough winter, that is still etched in people’s memories,” Burkett said. “These cold mornings in August are making people already start talking about winter.”
As owner of the region’s largest rental provider, Burkett is able to see what’s changing in the community based on the amount and types of applications turned in. After all, establishing a residence is usually step one for new or existing community members. All Pro Flathead Property Management has almost 700 units in the valley.
The approaching end of summer has led to an increase in rental activity, Burkett said. One reason is that Flathead Valley Community College starts classes on Aug. 29, attracting a demographic typically looking for one- to two-bedroom apartments.
“It really kicked in about a week ago,” he said. “From now until about the first week of September, it will be the big, busy rush.”
Another trend appears to be that a greater number of people are downsizing to live more within their means, Burkett said.
“People who were in $1,000-a-month rentals are coming in and saying, ‘Our hours have been cut back or our costs are increasing but our wages are not and we have to find a place for $750,’” he said.
CoRental Property Management in Kalispell, where Debra Hill has worked as a property manager the last three years, has close to 400 units on its portfolio and shares a similar view of the local housing landscape.
Hill pointed out that the difficult market has led many homeowners to look to renting as a way to try to avoid foreclosure. Sometimes it works, sometimes it doesn’t.
“I’m getting a lot more homes that aren’t selling and we’re turning them into rentals,” she said.
In a soft market like the one locally, keeping rental rates at a reasonable price while keeping a homeowner from foreclosure is a balancing act rental agencies are facing more frequently now.
“It is a real conundrum for owners and it’s part of the reason you’re seeing these places go into foreclosure,” Burkett said. “People bought the rentals when the prices were high, but they didn’t put much equity in them.”
But a lulled economy has put a heavy burden on both sides. People want to live here, but making ends meet is often difficult. Burkett has seen a number of people head to North Dakota to work in the oil fields. They make a lot of money but then come back after a year or so, he said, because they don’t like living there.
“So they’re moving back to the Flathead with a nest egg hoping that they can restart and find a job and be able to stay in the Flathead,” he said.
An encouraging sign for Burkett – and the community as a whole – is the new, albeit slow, job growth locally.
“We’re seeing more and more people moving here for jobs, not just hopeful for jobs,” he said. “That’s encouraging.”
That’s a forecast Burkett is happy to finally see.
“I really believe there will be other industries other than just the tourism industry that will start to build here in Kalispell,” he said. “I think we’ll have another spurt of growth once the national economy picks up. This is such a beautiful place. It’s a great place to be. The growth will definitely come back.”