There is definitely no fence-sitting if you’re an aspiring seller of a residential property in Missoula. The gains in home values here, especially in the county seat Missoula urban area, have been at a robust pace and still on track of a seven-year upward streak.
According to the latest market data from the Missoula Organization of Realtors (MOR), the median home price in the Missoula urban area during the first six months of 2017 jumped 9.8 percent to $269,000 from $245,000 a year earlier. Further underscoring the vibrancy of the metro area’s market, total homes sold during the comparative period gained a healthy 10 percent.
Repeat of Record 2016?
The 2017 first-half performance of the area’s housing sector notably constitutes a further improvement from the whole of last year. In an earlier report, MOR figures showed that the Missoula metro’s median home prices in 2016 rose by nearly 7 percent to $256,000 from $239,000 in 2015.
Over 1,240 homes were sold in the Missoula urban area last year, a six-year record high that appears likely to be equaled if not surpassed this 2017. As of last June, sales in the metro area already totaled 618 units, up 10 percent from the six-month tally in 2016.
Upward Price Trajectory on Tight Inventory
Moving forward, we can expect the regime of rising prices in the Missoula metro to continue as home inventory in the area is critically low. Housing stock is especially thin at the $200s and mid-$300s price points where just a one-month supply was estimated in 2016. For a balanced market, the ideal level is a six-month supply based on industry benchmarks.
Upward pressure on prices is likewise being generated by Missoula’s strong population growth in recent years. Census estimates released early this year indicated that the city has added close to 5,000 new residents since 2010, a 6.3 percent growth that brought its estimated population to 71,024. This figure compares with the estimated 69,190 city residents in 2015 and the 66,788 recorded in 2010.
Where the Downside Is
All these figures certainly look rosy for homeowners whose properties’ values are most likely appreciating. The downside though is for the newcomers in the Missoula metro and it’s working class whose income hasn’t kept up with the rising cost of housing.
The recent increases in home prices, estimated to have risen at an inflation-adjusted 114 percent since 1990, indeed present a formidable barrier for this market segment. One analyst from the Bureau of Business and Economic Research noted that Missoula college graduates earn an average of $32,000, one of the lowest annual income in the country and representing just 63 percent of the $50,500 national median.
A Road to a Fast Sale
MOR does not yet see an end in sight to this problem on home affordability and tight inventory. Home price gains will continue to outpace local wage increases, it noted. Meanwhile, new construction will take at least some three years to bring supply at a level sufficient to meet demand and in the process help stem the current steep rise in prices.
Given all these factors still weighing on the market, a significant slice of aspiring home buyers remains isolated from prospective sellers who want to cash in quick on the value of their property. WolfWantHouses can help in this regard through our fast home purchasing solutions that many sellers have found equitable and fair. Start a fast sale by filling out our form or calling us at 866-886-5345.
About Arturo Cuevas:
Arturo Cuevas covers real estate news in Florida as a Contributing Writer at Sarasota Bay Real Estate and The Motley Fool.