Focus on Real Estate


A buyer's market

For those who qualify for a loan, now is the time to buy


By Shelley Ridenour
Flathead Business Journal


There’s literally no time like the present for anyone who is thinking about buying property in the Flathead Valley, a cross-section of real estate agents say.
Selling prices have dropped, inventory is high and interest rates are at a historic low point. So, for people who can qualify for a home loan, now is the time to buy, those agents say.
Kory McGavin, broker-owner of Montana Land Office in Whitefish, said the Flathead Valley real estate market has made a 180-degree turnaround in the last two years, “where clearly the Flathead Valley had been a seller’s market to it becoming a buyer’s market.”
That has resulted in “great opportunities to purchase spectacular properties at much lower valuations than we’ve seen in the past,” McGavin said, including properties that probably wouldn’t have come on the market otherwise.
He thinks the market may have stabilized. “We’re not in a free fall as far as values. I believe we are close to the bottom,” in prices.
Realtor Terry Pietron of Century 21 Glacier Gateway in Columbia Falls says activity has picked up in 2010 compared to 2009. “I think we’ve hit rock bottom in the Flathead Valley, but it’s hard to tell,” he said. “Everything is a snapshot, you can’t really tell.”
Pietron agrees it’s a buyer’s market.
Business slowed down this summer and hasn’t yet picked up, said Paul Wachholz, broker at Coldwell Banker Wachholz and Co. Real Estate in Kalispell. He ties the change to the end of the $8,000 tax credit for home buyers which expired the end of April. After those transactions closed “we’ve more or less hit the wall,” he said.
McGavin said the local market has been driven both up and down by consumer confidence issues.
“Last year it didn’t matter how great a property or price, my clients were so uncertain of the national economy they were not willing to purchase,” he said. “This year there’s signs of hope. It’s like a switch went off and clients recognized it’s not the end of the world. The show goes on.”
The biggest problem in the Flathead Valley regarding home sales is unemployment, Pietron said.
A difficulty in the market, Wachholz said, is in the Flathead Valley, property values doubled or more between 2002 and 2006 “and now we’re paying the price for that high appreciation when the economy was reasonably good.”

Two factors are delaying economic recovery locally, Wachholz said. One is “no faith in Washington, D.C., and the socialistic programs they are introducing through various and sundry government programs.” The second is the double whammy in effect in the Flathead Valley in that “when housing starts are down locally and nationally, our people in the wood industries are not working. It’s difficult for an area like this with a lot of timber to buy and accented by the small number of new housing starts.”
The strong segment in the national new construction market has been rental units, Wachholz said. “There has been a lot of new rental being built because people losing or abandoning their homes are heading to a rental property.”
Pietron anticipates a wave in new rental construction to hit the Flathead, as people have to move out of houses they can’t afford.  When that might happen is unknown, he said.
“Even though interest rates have never been better, people do not have enough confidence in their employment, their cash savings and the ability to be comfortable to make an acquisition,” Wachholz said. “It still hasn’t been enough to motivate them to move up or buy their first home.”
If a new direction is taken in Washington, D.C., people “would start having a little more faith in what they are doing and what direction they are in,” Wachholz said. “Confidence is why they aren’t moving forward.”
Key to improved housing sales is that people become gainfully employed, he said.

There has been activity on real estate owned by banks and short-sale properties, Pietron said. And, he’s seen an increase in the number of Canadians buying local properties mostly because the Canadian dollar is “doing well against the American dollar at the same time real estate prices have come down.”
He’s also seen increased traffic from out-of-state clients this year, after a slowdown in those customers last year. People who visit the area, like it and want to buy have contacted his office, as well as people who thought about buying here several years ago and didn’t, but now are back in the picture because prices have dropped.
It’s more important now than ever before for sellers to stage their homes for sale, Pietron said. “Although it doesn’t affect price, it does affect [selling]. Curb appeal is utterly important.”
Yet nothing trumps price, he said. “People have to get over the fact that their house isn’t worth what is was two or three years ago and set the price right,” Pietron said.
Some sellers simply are waiting too long to put their house on the market, he said. They may be struggling to make payments, but wait as long as possible before considering selling and then, too often, lose their property because there isn’t enough time to sell it before the lender steps into the process.

Also contributing to the changes in sales trends, McGavin said, are changes in lending practices. People need to pre-qualify for home loans today and that process has become tougher than it used to be. But local banks are “lending money to good borrowers with good credit who can afford the property they want.”
It is definitely “more difficult to get a loan,” today, Wachholz said. “You need a better credit score, a larger down payment and probably you have a situation whereby if you don’t have that large a down payment there is no financing program available for you.”
Today’s buyers are smart, Wachholz said. “We see a lot of shopping and looking. They are very cautious. They are taking their time. We’re showing a lot of property, but not getting a lot of property to the finish line.”
That can make it tough for sellers, he said.
McGavin has worked in the local real estate market for 20 years but only in the last few years has he ever worked with banks to list repossessed properties for sale. “In 20 years of business we never had bank repos. That’s an unusual trend,” McGavin said. There have not been a lot of bank repossessions in Flathead County because most banks didn’t lend money to people who couldn’t actually afford the properties they wanted to buy, he said.
Wachholz also has noticed an increase in bank-foreclosed properties.
“It’s fairly easy to work with local banks who own their own real estate and have it in their portfolio,” Wachholz said, “but tougher to work with the larger banks who aren’t set up as well to handle the volume of repossessed properties that they have right now.”
Wachholz sees “bottom fishers” in the market who he describes as buyers who make offers “to see who’s really in trouble and if they’ll tilt and sell.”
Montana remains a “great place to live,” McGavin said. “As long as the Flathead Valley is still a great place to live, people are going to keep moving here for the lifestyle, quality of life and investment opportunities.”

Reporter Shelley Ridenour may be reached at 758-4439 or by e-mail at


Last Updated
Feb 24, 2020
Hagadone Montana Publishing
727 E Idaho  - Kalispell , MT 59901