UPDATE: See the comments to this post for discussion of this story plus continuing updates to the “S.W. Montana Meltdown.”
I find this fascinating:
I pulled this chart from Zilow.com in about 10 seconds. It shows the 1-year percentage price change for Gallatin County, Montana (down 10%) and Bozeman, MT (down 12%).
Yet the below article contains the following quote: Dennis Carlson, government affairs director of the Gallatin Association of Realtors, said “Housing prices are holding in the Gallatin Valley.”
It just goes to show you that the media and special interests will say what they want to say, regardless the facts. And people will believe what they want to believe regardless of the facts. It is a well known principal of psychology (called “confirmation bias“), but it’s always interesting to see it on display.
Makes me think of Bush’s quote after the New Orleans disaster: “Heckuva job, Brownie!” Or his “Mission Accomplished” fantasy. Right now we see the same thing going on as the media, and much of the public, continue in their recession denial.
Note: I do hope the housing contraction bottoms soon (it will be a great buying opportunity when it does), along with the credit crisis and stagflation, but I do not deny their existence. Now on to the article:
February 16, 2008
Bozeman Daily Chronicle
Cost of Living Went up 10% in 2007
By AMANDA RICKER
The cost of housing in Bozeman jumped by more than 10 percent in 2007, according to a report released Friday by Prospera Business Network.
The increase pushed the average purchase price for a 2,400-square-foot home in Bozeman up to $390,928 in 2007, and the average monthly rent for a two-bedroom apartment to $707.
That puts Bozeman’s cost of housing at 18.5 percent above the national average, up from 8.2 percent above average in 2006, the report said.
In 2005, it was below the national average.
But Dennis Carlson, government affairs director of the Gallatin Association of Realtors, said Bozeman’s high housing costs could be taken as a good sign. Housing prices are holding in the Gallatin Valley, unlike many other places across the country hit by foreclosures and other fallout from the sub-prime mortgage crisis, he said.
* “When you look at the national numbers, prices are going down with the sub-prime mess,” Carlson said. “We have a strong housing market in the Gallatin Valley compared to some of the really disappointing things happening in places like California and Florida.”
Housing costs in Missoula and Kalispell came in at about 20 percent lower than Bozeman. Both cities were below the national average.
Overall, Bozeman’s cost of living registered 4 percent above the national average in 2007, according to Prospera’s report. That’s the highest score recorded for Bozeman since 2001, when the city was at 4.2 percent above average.
Comparatively, this past year, Missoula and Kalispell both ranked below the national average, at 1.2 percent and 1.5 percent respectively.
The cost of living index is based on six cost components: housing, utilities, groceries, transportation, health care and miscellaneous goods.
Two of those areas n transportation and groceries n cost below the national average in Bozeman. Transportation was 5.6 percent below while groceries were 2.9 percent below.
Bozeman’s high cost of living can make it difficult for employers to hire or keep quality workers.
David Smith, president and CEO of the Bozeman Area Chamber of Commerce, said he’s optimistic that Bozeman’s cost of living will decrease..
“The fact that we’ve never really seen (housing costs) this far above (the national average) tells me that we can’t sustain that,” Smith said.
Prospera, a nonprofit economic-development organization, was previously called the Gallatin Development Corporation. The data comes from the ACCRA Cost of Living Index, which is measured by the Council for Community and Economic Research.