Nearly 50 percent of home sales are on small lots that are less than a half acre and do not have water frontage. These homes have gone through the same economic cycle that the overall housing market has, but the changes have not been quite as extreme as the overall market and they have been more resilient in their price recovery.
In 2005, when the overall median price increased by 18 percent, homes on small lots only increased by 14.6 percent. As the market declined from 2007 through 2011, the prices in the overall housing market declined by nearly 34 percent; however, the median home price on small lots only declined by around 31 percent.
The housing market has been recovering since the beginning of 2012 and over the last four years the overall median home price has increased by around 22 percent. Over that same period, the median price of homes on small lots has increased more than 28 percent.
When we consider that nearly 50 percent of all residential sales are homes on small lots and the fact that they have seen the fastest price recovery, it is evident that homes on small lots are the strongest segment of the Flathead housing market.
In 1981, Jim started Kelley Appraisal in Kalispell and has since built an extensive data base of economic and real estate-related data on northwestern Montana. Over the last
several years, he has published annual reports on the Flathead Real Estate Market and been a guest speaker on numerous occasions for various groups in the Flathead.