Great Falls, MT · Member since 2017 · 97 posts · 172 votes
7y
Some history and perspective from a 3rd generation Montanan, and someone who has been investing here for 18 years:
There are a few markets (Bozeman, the Flathead Valley, and Missoula) that are volatile. I bought a condo in Bozeman in 2007 for 164K . It seemed like a steal, because I'd spent the previous five years in So Cal with the military. I did not do my homework, and compared to LA prices, that condo seemed affordable. If this isn't obvious...I am warning people coming into the Montana markets from more expensive states or states with better job markets. Montana is it's own beast. By 2008, that condo value tanked to 115K. I graduated from my Masters program at MSU in 2009, and had to leave Bozeman due to the dismal job market. I could get a job, but positions in Bozeman were paying half of what the exact same job was paying in Great Falls. Why? Bozeman is awesome and many people are willing to work for min wage WITH a graduate degree just to stay there. Bozeman overbuilt so badly, that rents also decreased sharply and rapidly. I was able to rent that condo for $1300 when I bought and $800 when I left two years later. I broke even ONLY because I put down 20%.
I broke even for 8 years (when I was making more than the 1% rule in more stable markets)! Fast forward to the present....in the past 2-3 years, the value of this condo shot up to 235K! It has well-surpassed the pre-recession value. I currently rent that condo for $1450. The wages in Bozeman are NOT equivalent to the cost of housing and living. There's a reason us natives call it Bozangeles.
I am 1031 exchanging this condo for two properties (a tri-plex and a duplex) in Great Falls in the spring. People who don't understand Montana and the history think I'm crazy. They think Bozeman will continue to appreciate. In my opinion, the markets in these areas are not sustainable, and they will take the biggest "hits" when the market corrects. Only invest here if you can afford to ride out a market correction for the next 10 years. Seriously.
I am an advocate for more stable Montana markets. They aren't as "trendy" but they are where the money is at. It will be very difficult to make the 1% rule in Bozeman, Missoula, or the Flathead Valley, but it is obtainable in other Montana markets. During the last recession, values in Great Falls "dipped" a little. My rents decreased by $50 a month. Also, the values and rents recovered much more quickly.
Remember, a good rule of thumb is: "The best predictor of future behaviors is past behavior".
Contractor · Three Forks, MT · Member since 2014 · 4 posts · 2 votes
7y
I've been really busy and not very involved in BP for a few years. I am financing and building my second spec house 30 miles west of Bozeman off of Hwy 287. The first sold quickly and now the owners have it back on the market (under contract) a year later with 70K appreciation. I am looking for a hard money lender in the area. Does anyone know of a reputable one?
There are a few Montana folks on here, seems like a year ago I could count the BP membership (active at least) for the entire state on my fingers, but more active members every day. There is a group of us in Bozeman that get together twice a month to discuss real estate and sometimes play cashflow game. If you are ever in Bozeman on a Thursday evening, search meetup dot com for Bozeman cashflow club. If you are in Bozeman at any other time, I am always up for a cup o jo and a visit with a fellow real estate investor.
Cheers.
Are you guys still meeting twice a month? I would be very interested in joining you guys. I have been listening to bigger pockets for a few years now and they are a big source of my motivation in real estate.
Real Estate Agent · Helena MT · Member since 2020 · 44 posts · 7 votes
6y
Well hi everyone!
I am a newbie looking to buy my first property in SW Montana. Interested in rental and flips. I am looking to build some connections with people around here to have a successful start!
Investor · Belgrade, MT · Member since 2013 · 135 posts · 32 votes
6y
@Joseph Lodine No it is open, please join us. We have some very experienced investors and some newbies. First two meetings please join us, after that I will ask that you pay dues to help us with meeting space costs etc. if it is a value to you. June meeting will be online, but July we are meeting face to face at springhill suites. If you PM me your email address I will add you to the group email meeting announcements.
@Joseph Lodine No it is open, please join us. We have some very experienced investors and some newbies. First two meetings please join us, after that I will ask that you pay dues to help us with meeting space costs etc. if it is a value to you. June meeting will be online, but July we are meeting face to face at springhill suites. If you PM me your email address I will add you to the group email meeting announcements.
Hello Patrick, looks like it's been a couple years. I have a handful of rental properties in and around Bozeman. Is the Bozeman Investor Meetup still active?