Final Market Statistics for 2007 in Bozeman

Another year is behind us and we are headed into the second quarter of 2008. Before we look at the first quarter of 2008, let's recap 2007. At the end of 2007 we saw no appreciate over 2006; however, we did not see a decline in appreciation overall in Gallatin Country for 2007 - just a flat market.

Average home prices in Gallatin County rose slightly from $433,981 in 2006 to $435,665 in 2007 while median prices fell from $310,000 in 2006 to $303,000 in 2007. The biggest change in 2007 was the amount of time listings are staying on the market, which rose by 23 days to an average of 88 days on the market prior to sale.

The following graph represents single-family homes in the city limits of Bozeman. The first is a graphical representation of the listing price of a home vs the sales price of a home, including average days on the market. In Bozeman, 2 bedroom homes are selling for 96% of asking with an average price of $278,891; 3 bedroom and 4 bedroom homes are selling for 97.5% of asking with an average price of $301,922 (3-bd) and $393,674 (4-bd); and 5+ bedroom homes are selling for 95% of asking price for an average price of $393,612. Two and 3 bedroom homes are selling in 69 to 73 days, whereas larger homes are selling in over 80 days.

The next graph also represents single-family homes within the city limits of Bozeman. This is a graphical representation of what type of home sold in relation to how many of that type was listed. Sixty-four percent of all 2 bedroom homes listed sold in 2007 compared with only 37% of all 3 bedroom homes that were listed. This information is very valuable when listing a home. It informs the seller about competition. From this information, it is clear that in order to win over buyers for a 3 bedroom home, the home needs to be in tip-top shape! Likewise, if a seller is holding onto a 2 bedroom home, now may just be the time to sell.

The numbers produced at the end of the year, quarter, or at any time help buyers and sellers make informed decisions. These numbers aid in dressing a house for success, determining listing price and selling time frames. Combine these numbers with absorption rates (discussed in an earlier BLOG) and you're definitely one step ahead of any competition.

For detailed information specific to your neighborhood, send your request to Connie@BozemanMontanaProperties.com.

SBA Financing for Business Acquisition

Last night I attended a Webinar outlining the process of obtaining a SBA loan for business acquisition. SBA loans are similar to FHA loans for housing; they are government guaranteed. Essentially two types of SBA loans exist. SBA 504 loans are for business acquisition where real estate is also being purchased and SBA 7A loans are used for business acquisition not involving real estate, such as purchasing a retail shop in a mall.

There are 3 components to SBA loans. The first is buyer qualification, second is seller/business qualification, and the third is the application process.

Buyer Qualifications
Essential to buyer qualification is work experience and/or education in the field of the business to be acquired. Other qualifications include good credit history with scores above at least 625, down payment of at least 15%, personal guarantee, adequate reserves to cover living expenses and debt service. Of particular note if the buyer owns real property it will be attached with an SBA loan. What that means is the buyer's real property, say primary residence, will have a lien against it for the SBA loan.

Business/Seller Qualifications
The business or seller side of an SBA loan must also meet certain qualifications. The business must show steady or growing income on filed tax returns over the last 2-3 years. The lease terms must add up to the loan term. Most SBA loans are 10 years. The lease must be 10 years or increments adding up to 10 years, such as a 5-year term with a 5-year renewal. The seller must be willing to provide 2 to 6 months of training, although this training does not have to be done on site, it can be a combination of in-person and phone consultation. One important consideration that increases the strength of the application includes seller financing of 10-30%. This is increasingly common for business and commercial loans of all types. However, the seller cannot have an equity position in the company. Lastly, it is possible that SBA will loan working capital for 2-3 months during the transition. The seller can provide estimates for working capital to be included in the loan amount. Working capital cannot include buyer's income, but can include salaries to employees, product purchase, overhead, etc.

Application Process
The application process can be cumbersome, but it is designed that way to ensure the business is a good buy and that the business will survive. All of the following may be required for an SBA loan: application forms (about 14 different forms), tax returns from the business for 2-3 years, copy of the lease, photos of the business, personal resume of the buyer, 3-years of personal tax returns of the buyer, business plan (6-10 pages), and copies of appraisals if available (this may be required later). Keep in mind the buyer and seller/business qualification when submitting this material, for example, submitting a lease for only 2-years will not be sufficient.

Once the material is received, the approval process will take 2-14 days after which a letter is sent to the buyer that must be signed and returned for the loan to begin processing. Loan processing can take 20-90 days and closing (funding) can take 1-2 days.

All lenders are different. The SBA loan is guaranteed by the federal government, but the loan is issued by a local bank or commercial lender. Interview several lenders. Be sure they are familiar, if not experts, in SBA financing. For a lender recommendation as well as recommendations to excellent commercial brokers, please contact Connie@BozemanMontanaProperties.com.

The Legends at Bridger Creek

Located a short jaunt from historic downtown Bozeman lies one of the best premier developments ~ The Legends at Bridger Creek. Nestled between the foothills of the Bridger Mountains, the Story Hills and bordered by Bridger Creek, this new community makes full use of these natural features to accentuate the very essence of this development. Natural trails lead walkers, runners, and bicyclist through the entire community and along the creek, where you will find folks brushing up on their fishing skills.

The Legends at Bridger Creek is a planned unit development consisting of 77 acres with almost half of this being preserved for open space, trails, and an 11-acre park. A 3,000 square foot multi-purpose clubhouse features a fitness center, pool, spa, kitchen, and great room offering activities for everyone to enjoy.

Currently in the early building phases, lots are available for purchase. Don't have an architect? The Legends offers several lots with architectural plans. Current prices for this phase range from $120,500 to $175,000. Lots range in size from approximately 7,100 sq. ft. to almost 12,000 sq. ft.

If you would like a personal tour of the Legends at Bridger Creek, schedule your appointment today with Connie@BozemanMontanaProperties.com or call Connie at (406) 585-5414.

For more information visit www.LegendsBozeman.com.

Home Improvement Projects with the Highest Return

Summer is fast approaching and soon it will be time for some home improvement projects. The Cost vs. Value report is out and below are the top projects bringing in the highest level of return.



These figures are based on midrange projects. The information was taken from http://www.costvsvalue.com/. On this very valuable website, readers can get exact descriptions of the projects.

According to the report, the three projects with the least return include adding a sunroom, installing a back-up generator, and remodeling a home office.

For up-to-date market value information about your specific home, send me an e-mail to Connie@BozemanMontanaProperties.com.

Wednesday with Connie ~ 1031 Exchange

The IRS just issued new rules regarding 1031 Exchanges. Many investors will exchange investment property for vacation homes. The IRS ruled that this is OK provided the following is adhered to:

The vacation home must be leased or attempted to be leased for no less than 14 days.
Owners cannot use the home longer than 10% of the total time the home is leased.
Owners may stay at the home as is reasonable to make repairs.

It is highly advised to keep very accurate records, especially as it pertains to leasing your vacation home. Investors need to adhere to this rule for a minimum of 24 months, broken into 12-month segments. That means that each of the above provisions need to be proved in 12-month segments.

For more information or for a referral to a 1031 Exchanger, please let me know at Connie@BozemanMontanaProperties.com.

Are you ready to buy an investment property in Gallatin or Park County? Now is an excellent time for this purchase. I'm here to help and to answer your questions. Please e-mail today or for immediate attention give me a call. Connie@BozemanMontanaProperties.com (406) 585-5414.

Tuesday's at Dave's Sushi

Thank you faithful readers. I have yet to get to Dave's Sushi today, but I will be there shortly. Today is my friend Todd's birthday, so its off to Dave's!

Dave's Sushi offers a superior sushi experience in Bozeman. For those less familiar with sushi, I'll explain. Sushi is more than just raw fish. There are three basic way to eat sushi. There's the blob of rice with a slice of fish across the top or nigiri, a handroll which basically is seaweed loosely holding together a mixture of rice and goodies, and a roll which is tightly rolled seaweed with rice and goodies inside that is sliced into half inch pieces. Dave's made some additions to the menu for those less daring to throw a raw piece of maguro (tuna) in their mouths! Rice bowls were created. Having only had one rice bowl, I can't speak to all of the combinations, but the one I had was excellent. Additionally, the non-raw-fish-connoisseur can also enjoy the avocado/mango nigiri, edamame, and salad.

For dessert there's Elle's Belle's cookies...or if you're lucky chocolate pudding cake!

Monday Morning Tip - Time for Trimming

Before becoming a real estate "tycoon" and expert cookie baker, I owned a small interior and exterior landscaping company. Needless to say, when the sun shines more than the clouds cover and I start to see green, I get ready!

Last week I encouraged readers to clear the snow from their yards by spreading it out. Well a lot of snow has melted this last week so it's time to begin trimming!

Everyone has their own method, but I save most of my trimming for spring. In my flower gardens I do this so the plants left in place can provide some extra insulation over the winter months. I've seen some folks put straw over their flower gardens - maybe I just don't want to clean up straw! I would wait to trim your flower beds for another week as temperatures are still fluctuating. However, not is a great time to start trimming those shrubs. It is much easier to trim shrubs in the spring because there are no leaves and I can really get in there and see what I'm trimming. When trimming shrubs, look for suckers, those shoots coming directly from the roots. Also think about shape and trim accordingly. If you're looking for something whimsical, say in a forsythia, trim each branch separately, keeping branches in varying lengths. If you're trimming for a natural border, trim the terminal bud (the top part of the branch) so the shrub will be encouraged to bush out. Consult with your local nursery for specific plant trimming tips.

Now is also an excellent time to reseed your lawn. There is still a lot of moisture in the soil, minimizing watering requirements. Spring is the best time to see the "bald spots" in the lawn.

If you plan to list your home in April, by taking care of these things in March, your exterior will be ready for show!

I love flower gardening. If you're looking for someone to brainstorm design with, send me an e-mail, Connie@BozemanMontanaProperties.com. I also have some great referrals for landscaping materials, plants, and installation.

These last couple of weeks have all been geared towards getting your home ready to sell. If you plan to list this spring, it's also time to start interviewing Realtors. Please schedule your appointment today by phone (406) 585-5414 or by e-mail Connie@BozemanMontanaProperties.com. I look forward to meeting you.

Sunday Investment at Meadow Creek

Saturday afternoon I was looking for a place to walk my dog as well as check up on the local real estate market. I wandered into Meadow Creek Subdivision, located off South 19th where those funny street lights begin. What a pleasant surprise. Located in an old pasture, Meadow Creek is bordered on the east by South 19th and on the west by beautiful cottonwood trees. Majestic Bridger and Gallatin Mountain views abound. For your pampered pooch walking trails bisect the greenways throughout the nearly 56 acres of parks, wetlands, and open space.

The roads are in and a huge church is under construction. There are 95 lots for currently on the market ranging from 5,000 square foot lots listed for $99,5000 up to 15,000 square foot lots listed for $176,300. There are several multifamily lots available for 4-plex and duplex construction.

I met with a lender last week that offers an excellent new construction lending package. Let me know if you need a referral by e-mail at Connie@BozemanMontanaProperties.com.

In the meantime, check out these lots, be amazed by the views, plan for your new home.

What are your housing needs and wants?

Over the last 5 days 80 new residential listings were input onto the MLS system in Gallatin and Park Counties. These homes range in price from a mobile in Manhattan listed for $39,900 to a $2,950,000 home in Bridger Canyon.

With a lot to choose from, it's important to narrow your search. I ask each of my clients to think carefully about what they want, how many bedrooms, bathrooms, what are their living space requirements, where do they work in relationship to where they want to live, and what type of lifestyle do they wish to have. A home in downtown Bozeman offers a very different lifestyle than one on 5 acres or a home located in one of Bozeman's newer communities, such as Harvest Creek. Even the newer communities differ considerably.

When buying a home it is also important to consider your 2-year and 5-year plan. While plans change it is vitally important to keep this in mind as you shop. If you're looking for a 2-year investment before upgrading, appreciation and resale is likely top on your mind. If, on the other hand, you're looking for your home for the next 20 years, lifestyle will be very important.

Ask your Realtor to work with you through these decisions. A home is a wonderful investment, but it is large purchase. Spending time to work through these issues beforehand is vital.

If you have questions, send me an e-mail! Connie@BozemanMontanaProperties.com

Calling All Veterans!

I just met with a lender that announced Bozeman's Road to Home money can be used with VA loans! This is an incredible opportunity for young veterans getting started in Bozeman. Road to Home program provides up to $20,000 in down payment assistance to qualified borrowers. The Road to Home down payment assistance is a second mortgage with unique features. It is not due until after the first mortgage is paid. This keeps those payments low, especially for just getting started.

VA loans are government guaranteed. VA does provide 100% financing to qualified veterans, plus financing for the fees associated with the loan. A veteran can use the VA program every time they buy a new residence provided the borrower is not currently paying on a VA loan. The new limit for VA loans is $1.5 million, up from the previous limit of $417,000. Certain restrictions apply to these larger loans.

If you are a veteran looking to buy your first or tenth home, I met the perfect lender for you. Please give me a call at (406) 585-5414 or send me an e-mail to Connie@BozemanMontanaProperties.com.

Happy house hunting!

Determining Absorption Rates

One of the most important bits of information to know when listing your house is absorption rate. Absorption rate reveals when all the homes on a market will sell, provided no other homes are added to the market. It is used to determine when a market will "sell out" of inventory. By knowing the absorption rate in your area while your home is listed will help you determine pricing, marketing, and other valuable information to make your home the most appealing and most likely to get a sale. It will also give the seller the most likely scenario as far as time-frame to sell.

To determine Absorption Rates:

1. # of listings currently on the market = x
2. # of listings that sold last month = y
3. y times 12 months = # sold per year
4. # sold per year divided by 52 weeks = # sold per week
5. x divided by # sold per week = absorption rate per week

In general, a seller's market results when the answer to #5 above is as low as possible. Conversely, a buyer's market exists when the absorption rates are high.

If you are about to list your home or your home is listed, ask your Realtor to tell you what the absorption rate is in your neighborhood.

For more information, send me an e-mail. I am always happy to help. Connie@BozemanMontanaProperties.com

Tuesday's at Movie Lovers

Located in the Albertson's shopping center on 23rd and Main is Bozeman's independent video store ~ Movie Lovers. At Movie Lovers you will be greeted with a smile and an old-fashioned "hello". Clerks actually walk around the store helping customers! Movie Lovers has a great selection of the newest titles. Most unique to Movie Lovers is an excellent selection of foreign and independent films. If you're brushing up on your French, for instance, rent a movie in French. Movie Lovers prepared a list of all of their foreign titles, so you can easily go right down the list or search for foreign films by title.

Tuesdays are a treat since that is the day new movies are released. Visit Movie Lovers tonight, rent your favorite flick, and curl up on the sofa with some popcorn and a date!

Need a house to put your sofa in? Give Connie a call at 406.585.5414 or e-mail connie@BozemanMontanaProperties.com.

Monday Morning Tip ~ Getting Ready for Spring

With temperatures forecasted in the 50's today, one can't help but want to see summer a little bit faster! I spent most of my 20's in Tahoe City, where snow buried the ground well into May. As Memorial Day approached, we used to spread out the snow with our shovels so that it would melt faster exposing our winter covered ground.

How does this apply to Bozeman? Well, if you're getting ready to list your house for the spring, begin now by spreading out the snow burying your lawn. Once the snow melts, yard cleanup can start, such as raking the lawn, cleaning up snow-buried trash, and preparing to plant brightly colored flowers in the ground.

Now is also a great time to plant annuals in pots for your front porch and deck areas. In a few weeks, they'll be growing like gang-busters. Keep an eye on the temperatures as you may need to bring your pots inside during some of the frostiest nights.

By melting your snow and preparing your yard now, your property will be in tip-top shape for spring open houses.

If you have any questions or would like market pricing information for your home, send me a quick e-mail at Connie@BozemanMontanaProperties.com or give me a ring at (406) 585-5414.

New FHA Limits! Great News for First Time Home Buyers

FHA just dramatically raised their loan limits in Gallatin County. This is a huge boost for first time home buyers. FHA loans are geared for first time home buyers and are backed by the Federal Government. Here are the details:

Gallatin County FHA loan limit: $386,250
Required buyer contribution: 3% or $11,587.50
Gift funds OK for a down payment

Park, Broadwater, and Madison Counties FHA loan limit: $271,050
Required buyer contribution: 3% or $8,131.50
Gift funds OK for a down payment

These are incredible increases over last year's $250,000 limit. FHA is a great program because it is backed by the Federal Government and helps first timers get into homes. In Bozeman, there are currently 209 single family detached homes under this new loan limit. Buyers have a choice.

I have been meeting with lenders so that I can learn more about the various loan programs they offer to make appropriate referrals to my clients, friends, and acquaintances. Send me an e-mail or give me a call today and I'll help you find an excellent lender! Connie (406) 539-9255 or Connie@BozemanMontanaProperties.com.

Eagle Point Estates Just Listed

Nestled in the heart of Manhattan is Gallatin Valley's newest subdivision ~ Eagle Point Estates. Phase I features 90 residential lots, 8 town home lots, 2 four-plex lots, and a commercial town center. This subdivision is being billed as "refreshing approach that embraces the culture and heritage of old town Manhattan". This new town has narrower streets and 10-foot setbacks with all parking in rear alleys. The hope is this will foster communication among neighbors, slow traffic, and create a community. Eagle Point Estates plans pocket parks and green space throughout.

This development is accepting reservations now. Final plat is expected in December 2008. Building can commence as early as the beginning of 2009. Listed by Dan Porter and Ed Thomes. Prices start at $65,000. Call me at (406) 585-5414 to reserve your lot today or to learn more about this planned community.

Here's a little bit about Manhattan. This community lies 20 minutes northwest of Bozeman on I-90 with a quaint downtown. The Oasis is a popular dining spot. The town grocery is a place to go where everyone knows your name. Not a single thing is open on Sunday -- not even for a quick cup of coffee! The railroad goes through the center of town. Manhattan is a great place to call home, where you can escape the crowds of Bozeman and Belgrade, if that is what you fancy.

Wednesday with Connie ~ Today in Real Estate

I wake up before the sun rises every day. This gives me the opportunity to get a pulse on the market, check e-mails, and make my list of things to do for the day. As it gets lighter outside I slowly get glimpses of the days weather and my question for today is when will it stop snowing?

Don't get me wrong, I really like the snow and I'm an avid skier and ice climber, which is part of the reason I live in this beautiful town, but I want to see some tulips! Easter will be here in weeks and this weekend we'll be changing our clocks forward. It just seems that the Easter table is incomplete without a bouquet of tulips.

Today in real estate: 38 new listings in SW Montana, including 6 new homes on less than an acre, 6 new homes on more than an acre, 7 new subdivision lots, 8 large-acre parcels, 5 condos located in Belgrade, Bozeman, and Big Sky, 2 commercial properties, and 2 recreational parcels.

Of the new listings, the homes on less than an acre have an average price of $358,600 and a median price of $339,900. What this tells you is that there are one or two homes that have a relatively large asking price, bringing up the average. However, the majority of the homes listed are below the average. This is revealed because the median price is lower than the average. When the average and the median prices are very similar that means that there is just about the same number of homes below as above the average price.

Do you have a question about real estate? Email me and I will post your answer on my BLOG. connie@BozemanMontanaProperties.com

Tuesday at Tesoros

Located at 19 East Main Street in Belgrade is a little store with big appeal!

Tesoros~Treasures for the Home

The ornamental ducks in the front window greet passers by with an alluring "come on in" playfulness in their stature and what a treat for those that do. Tesoros country feel shines through in the items found inside the store from wood-framed mirrors to candles creating intimate spaces inside your home. There are so many treasures in this wonderfully laid out store, making it a pleasure to shop.

Tesoros is an excellent place to help you personalize your home, whether you've just moved in or have been living there for awhile. Stop by today and say "hi" to Robin, the store owner, you're sure to find that perfect accent for your home.

Monday Morning Tip ~ Photographing Your Property!

A photo is worth a thousand words! Make no exceptions! Since a great majority of house hunters start their search on the internet, put your properties "best face forward".

Below are two examples of ways to photograph a property. Study these, then take photos of your property. If your Realtor shoots bad film, ask for a re-do! Be sure in this buyer's market your house looks best!

This photo, in itself, is a decent photo of house, but it doesn't create atmosphere. There's nothing going on. The front yard tree is blocking the view of the house and from the look in this photo, creating an awful lot of shade. How can you fix this?

1. Don't take this photo in the afternoon (this house faces west so the sun is shining from behind, creating all that shade)
2. Take the photo mid-day or, better yet, early morning
3. Take a photo of this house from the side, avoid having the tree as the focal point
4. Remove the items from the driveway
5. If there is a gravel driveway, such as this, try to include it in the photograph.
   

This photo creates an atmosphere. Lights are glowing from inside the house, it feels warm inside. The outside environment is prestine, there are horses in the background making it seem like Montana. How can you improve on this photo?

1. Add people inside, creating a livey dinner party
2. Take this photo at twilight so that the horses are more visible and there is a hint of alpenglo in the sky.

The second photo is considerably better than the first one mostly because it creates an atmosphere, a feeling of home. There are lots of ways to do that, below are a few:

1. Add kids playing in the front yard
2. Add people inside a well-lit house for a dinner party
3. Take pictures in the early morning or twilight for natural "mood" lighting
4. Have puppies scrambling around in the yard
5. Add two rocking chairs to the front porch, rock one of them just before snapping the shot
6. Add full colorful flowers to the front porch in big planters.

Have fun with your photos! It could mean the difference between having someone schedule an appointment to come see your home!

Sunday Investment

While searching the Real Estate section of the Bozeman Daily Chronicle I came across an excellent opportunity for a savvy investor. The property is located on Perkins Place. I happen to be very familiar with this particular piece of property. It is one unit in a 5-unit condo complex. This unit features 2 bedrooms and 1 full bathroom on the upper level with a deck off one of the bedrooms and a living room/dining room combination with a full kitchen, half bathroom, and laundry closet on the main level with a back patio with privacy fencing along both sides. Both the patio and deck face west for gorgeous sunsets. As an added bonus, the "backyard" is not dividable and very large, extending all the way to Rouse. What this means for the homeowner of this condo is that nothing will ever be built in your backyard.

The asking price is $145,000. My recommended starting offer is $135,000. With a 5% down payment, 6.25% interest on a 30-yr fixed mortgage, your monthly payment totals $790 + taxes, insurance, and homeowner dues.

To view this property, please send me an e-mail at Connie@BozemanMontanaProperties.com.

Come back next week for Sunday Investment.