Looking back at 2021, it comes as no surprise that fervent buyer demand dictated another fast-paced year for the real estate market. Every niche area of the market here in Southwest Montana was influenced by the basic economic principals of supply and demand. The lack of housing supply in all areas of the market is driving substantial price increases. Although new construction activity is strong, it is limited by a combination of labor and material shortages and rising material costs. Let’s begin our 2021 Year-End Real Estate Market Review for Bozeman by looking at the greater Gallatin County.

 

Gallatin County

The strong seller’s marker of 2020 continued and even strengthened in 2021. Inventory levels remained low and multiple offer situations were common across much of the housing market. This is true both locally and nationally. Let us dive into some numbers:

 

Sales

• Pending sales decreased 14.7%, finishing the year at 2,679.
• Closed sales decreased 7.6%, finishing the year at 2,742

Listings

• Compared to 2020, the number of homes available for sale in 2021 decreased by 41.9%.
• At the end of 2021 there were 157 active listings.

Prices

• The overall median sales price increased 36.2% to $599,000.
• Single family home prices were up 30.5% compared to last year.
• Condo/Townhouse home prices were up 32.8% compared to last year.

List Price Received

• On average, sellers received 100.5% of their list price, up 1.5% from 2020

 

2021 brought many changes to the Greater Bozeman area with new construction projects in the hotel space as well as larger apartment complex builds. The limited inventory is driving increases in the median and average sales for all housing types, setting new records across the board. There were 978 single-family and 680 condo/townhome units sold in 2021.

 

 

There are no two ways about it, Big Sky is “blowing up”. The area has experienced exponential growth over the past few years. Labor shortages and lack of workforce housing are two issues plaguing Big Sky that community leaders are working to solve, but it will take time and infrastructure investments to provide relief. The recent opening of luxury hotel and spa – Montage Big sky – as well as the announcement of The One and Only’s first luxury resort in the US coming to Moonlight Basin, is driving even more interest in our little corner of the world. 2021 saw 94 single family sales and 244 condominiums. Additionally, Big Sky has seen the biggest increase in prices in our market, with median sales soaring over $2.4m for single-family and condos over the $1m mark.

 

 

As part of our analysis in this 2021 Year-End Real Estate Market Review for Bozeman, we anticipate seeing the trends of the last 18 months continue into 2022. This would push home prices higher even still. As mortgage rates are likely to continue to rise this year as well, housing affordability will remain an important factor to watch.

 

Many new projects and developments in the area will hopefully relieve the strain on inventory. Prices likely continue to increase at similar rates to 2020 and 2021. Eventually, as we hope to see an increase in inventory levels we will see some market stabilization.