Why People Buy a Home

Magic of Montana

By Gerald Vander Pyl, for the Calgary Herald

 

With the continued strength of the Canadian dollar, many Albertans are looking south into the United States for recreation property.
For many, the priority is a warm-weather getaway in a Sun Belt state such as Arizona or California. But buyers interested in four-season recreation often look to our nearest neighbour to the south — Montana.
The Tobacco Valley near Eureka, Mont., has seen its recreation property market supported in large part by Calgary buyers in recent years, says Mike Workman, broker-owner of Century 21 Eureka Land Office.
While prices are down from a few years ago, there’s currently a short supply of recreation-style properties available in the valley, along with a large demand for them, and that’s kept prices from falling to the same extent as those of residential real estate in the area, Workman says.
Property near any of the valley’s lakes is typically about three times the price of a similar residential property in Eureka, while anything with a view of Lake Koocanusa is about double the price.
Some of the most sought-after recreation property in the Tobacco Valley is lakefront real estate on Dickey, Glen and Sophie Lakes. A typical lot with about 30 metres of shoreline sells for close to $1 million.
Barry Ehlert, managing partner of the Windmill Golf Group, which is developing the Wilderness Club near Eureka, says the area has a laid-back Western atmosphere, not unlike Alberta, and is only about 3.5 hours’ drive from Calgary in the midst of a particularly beautiful part of Montana.
“The sheer beauty of Montana is pretty indescribable, and tough to replicate,” says Ehlert.
Lake Koocanusa and its crystal-clear water is a major attraction of the Tobacco Valley, and more than half of the lake’s 145-kilometre length is on the U.S. side, allowing for boating, fishing and access to many great sandy beaches.
More than 12,000 hectares of nearby forest-service land offers access for hiking, ATVing and other land-based activities.
The wonderful weather of the valley means people can be enjoying a beautiful early-summer day while snowmobilers are still out riding trails in the mountains only 35 minutes away, Ehlert says.
The Flathead Valley, and communities such as Whitefish, Kalispell and Big Fork, is another region of Montana that has traditionally been popular with Calgary buyers.
Katie Brown, co-owner and managing broker with Trails West Real Estate, says it’s a buyer’s market for real estate in the area at the moment, and she advises sellers to price their properties attractively.
“We’ve been selling real estate here for 20 years, and this is probably the best inventory and the lowest pricing that we’ve seen in a long, long time,” says Brown.
Some examples include real estate at Whitefish Mountain ski resort, formerly known as Big Mountain, starting at $100,000; a one-bedroom condo in a lakeside development on Flathead Lake in the low $60,000s; and a townhouse on Eagle Bend Golf Course for about $280,000 — a property that would have cost $380,000 a few years ago.
Single-family homes on golf courses are going for about $100 per square foot, Brown says, citing a recent listing for a 5,200-square-foot home at $539,000.
Although the Flathead Valley is in the northern half of Montana, it has a much milder climate than Calgary, with the golf season typically stretching from late March until November.
In addition to outdoor activities like golf and skiing, the region also has a wealth of cultural attractions, with communities such as Big Fork having a thriving theatre scene, art galleries, and even an orchestral group that brings in guest musicians for performances.
“There’s never a lack of activities to enjoy,” says Brown.
MONTANA AT A GLANCE:
• Montana was the 41st state to join the U.S., gaining statehood in 1889.
• It’s the fourth-largest state in area, but with fewer than a million people it has the 44th-largest population, so there’s plenty of wide open space for relaxed living and recreation.
• Montana boasts abundant lakes, trout streams and big game, along with world-class ski resorts.
• Montana has entrances to two famed national parks: Yellowstone in the south and Glacier in the north.
• The topography of the state is roughly half mountains and half prairie, with a wide range of climate and weather.

Web links: c21eureka.com; thewildernessclub.com; trailswestrealestate.com

Housing Crisis to End in 2012 as Banks Loosen Credit Standards

The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago.

Additionally, a Fed Senior Loan Officer Survey found credit requirements in the fourth quarter were consistent with the past three quarters.

However, other market indicators point not just to a stabilization of mortgage lending standards, but also a loosening of credit availability.

Banks are now lending amounts up to 3.5 times borrower earnings. This is up from a low during the crisis of 3.2 times borrower earnings.

Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.”

In contrast to a low of 74 percent reached in mid-2010, banks are now lending at 82 percent LTV.

While credit conditions may have loosened slightly, some potential homebuyers are still struggling with credit requirements. In fact, Capital Economics points out that in November 8 percent of contract cancellations were the result of a potential buyer not qualifying for a loan.

Additionally, Capital Economics says “any improvement in credit conditions won’t be significant enough to generate actual house price gains,” and potential ramifications from the euro-zone pose a threat to future credit availability.

*Information provided by DSNews.com written by Krista Franks Brock.