Connections in Montana

[Shaun Moore]

Wondering if anyone else from Montana is active on here! Who are you? Where are you from? I noticed this forum had no posts so I wanted to start one.

I'm looking for some connections and always like "local" people, or someone who knows Montana.

[Alissa Engel]

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".