Flander Mills Neighborhood

A for sale sign is posted in a yard as a neighboring home is under construction in a new development on Flander Mills Road on Wednesday.

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The housing market in Bozeman continues to chug along despite the COVID-19 pandemic, with increased interest from out-of-state buyers.

The median sales price for a single-family home increased 3.5% last month compared to April 2019, going from $425,000 into $440,000. The median price of condos and townhouses dropped 9.7%, from $348,450 in April 2019 to $314,500 last month, according to a release this week from the Gallatin Association of Realtors.

“The Gallatin County real estate market continues to hang tough in spite of the effects of COVID-19,” said Gallatin Association of Realtors Board President Claire Gillam in the release. “While we can expect continued impacts from the coronavirus situation, our market remains well-positioned for the future.”

It’s unclear exactly how the pandemic has affected the number of out-of-state folks buying homes in Montana, but ERA Landmark broker owner Robyn Erlenbush said the interest is increasing.

“What we are seeing is a lot more inquiries of people wanting to move to Montana, and I don’t see that our demand is going to go down,” Erlenbush said. Buyers giving offers before visiting a property has become more popular, as well, especially as video technology has advanced.

For ERA properties specifically, condo and townhome prices rose by 2% compared to 2019 and single family homes rose by 8%, Erlenbush said. Those growing prices are good for investors and people who already own homes and want to sell, Erlenbush said, but put renters and potential first-time buyers in a difficult spot.

Rapidly rising housing costs have long been a problem for Bozeman residents whose wages on average have not grown fast enough to keep up with the cost of homes and with what out-of-state buyers can often pay.

According to the city of Bozeman Community Housing Needs Assessment published in February 2019, average wages increased 2.6% year to year between 2012 and 2018, or about 15.6% overall.

During that same six-year time period, rent in Bozeman increased between 35% and 40%, and the income needed to buy a median-priced single family home doubled from $52,000 per year to $104,000 per year.

“When homes do become available, they are not on the market long and residents often must compete with cash buyers moving in from outside the area to purchase homes,” the assessment stated.

Earlier this week, the New York Times published a story using U.S. Postal Service mail forwarding requests to show where wealthy New Yorkers are escaping to amidst the pandemic. The Times reported that mail forwarding requests for March and April doubled compared to the year prior, and over half of the requests were for addresses outside of New York City.

Many of the people leaving New York City went to nearby areas like the Hamptons. Others went to sunny destinations like Florida and California. But Montana also had its share of mail forwarding requests, the majority of which appear to be in Gallatin County or nearby.

Other experts are also predicting that those who are able will move away from large cities to suburbs and smaller cities.

The CEO of Redfin, a national real estate company, predicted people will leave large cities for smaller ones and specifically mentioned Bozeman, as reported by GeekWire. And many people who already own vacation homes in the area have already retreated to those usually vacant residences, as reported by the Wall Street Journal.

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Melissa Loveridge can be reached at mloveridge@dailychronicle.com or at (406) 582-2651.