Kalispell Market Report: Land – October 2022

Kalispell Market Report: Land – October 2022

This report covers the residential land market in Kalispell Montana as of the end of October 2022. Land sales continue to remain low and available inventory continues to increase. The residential land market in Kalispell has slowed from the robustness of the last few years.

INVENTORY

As of early November, there were 184 residential land parcels for sale in Kalispell which is essential flat compared with October’s inventory of 183. Although a gain of one is very small, it is still the seventh month in a row of increasing inventory.

Five or more acres

Of the land currently for sale 33% of the listings include five or more acres. I define rural as those properties in the 5+ acre category. Those are most likely to be parcels located on a gravel mountain road, agricultural farming land, or acreage adjacent to National Forest or lumber parcels. They are often not located in a development, but by themselves, and provide privacy and multiple building and usage options.

The currently active properties over five acres range in price from $225K to $4.9M with an average price of $915K.

Same as last month, there are two 5+ acre parcels for sale at the low price point. One is 20 acres of forested land with access issues and one is 8 acres of land with county road access. The highest priced parcel includes 795 acres that borders forest service land.

Below five acres

In terms of the listings below five acres, many are located in developments. These parcels currently range in size from .09 of an acre to 4.9 acres and in price from $125K to $1.8M with an average price of ~$255K. Many of these come with monthly or annual HOA fees. They are also often covered by CCRs or Covenants, Conditions and Restrictions which define rules for building and living in that area.

PRICING

Price per acre can vary dramatically and often doesn’t seem to make sense when viewing prices. Why is one 20 acre parcel priced under $200K and another $500K or more? Great question. Following are some pricing rules that seem to be true for land.

The first is, every parcel is unique. With land, you can’t say the average price is $/acre, and this is a 20 acre parcel and therefore it should be $/acre times 20 acres. Instead, the specific topography, physical and legal access, utility availability, distance from town, potential usage, views, zoning, covenants and more need to be taken into account in order to come up with a legitimate price point. If you are thinking of selling your property and are told by an agent that the average price for land in Kalispell is a certain amount, and that you can just multiply that by the number of acres you have, call me. That’s simply not the way the process works.

The second general rule is that the more land you are selling or buying, in general, the less you should expect to pay per acre. For example, looking at the past ten months of land sales in Kalispell, you can see that as you purchase more land, the average price per acre decreases.

Bottom line

The bottom line with land in Kalispell, Montana is that every piece is unique, with different requirements, rules, views, utility options, amenities and of course prices.

SALES

In October, 14 land parcels sold which was 26% fewer than last year but 17% more than last month. Last October saw 19 sales compared to 14 this October and as the chart below indicates, sales in 2022 have been lower in every month compared to last year. There are currently 41 land sales under contract which is lower than last month.

Length of Time to Sell

Land listings typically take longer to sell than home sales. The average days on market for land in 2021 was 5.1 months which was significantly less than the previous year. In October 2022, it took six months on average for the 14 parcels to sell. Year to date land has taken on average 4.4 months to sell but with the longer time required in the last few months, this metric is on its way up.

PRICES

Average or median sales prices are meaningless when discussing land sales. The qualities of one lot over another are so different as to make most comparisons moot. That being said, I am including a view of the total dollar value of all land sold per month to provide some kind of comparison to the previous year.

In October 2022, $4.1M of land was sold, 10% more than last October and 66% more than last month. Land parcels currently under contract have a list price value of close to $12.2M. So many factors go into the $ value of land sold that this is more of an informational fact than a predictive one.

In terms of the lowest and highest prices for a land parcel sold, the lowest price parcel in October sold for around $40K. It was .9 of an acre in town. At the other end of the price range was a 12 acre parcel with mountain views and use of a Foys Lake dock. This sold for around $850K.

The bottom line about prices for land – no matter your budget, you can find options in your price range!

SUMMARY

Every piece of land is unique, even those in a development. Views can be dramatically different just moving from one acre to another. I love walking land with clients! If you are interested in selling or buying land, and you want to work with a boot-wearing broker who is ready to find the borders, call me at 406-270-3667. I’d be happy to help!

To see previous land-related market reports, click here.

Thank you for reading Kalispell Market Report: Land – October 2022!