Preparing Your Property

Getting ready to sell

Sometimes it takes only the first few minutes after a potential buyer walks into a house that we’re listing that the potent feeling hits: a powerful visceral reaction that says, “This is home.” It’s an emotional reaction that cannot be predicted or explained. It may be an intangible connection to the house or, more likely, the result of a seller properly preparing their home to show off its very best assets. Working with Stuart and Sally allows our select group of clients to take advantage of our experience in the areas of both interior design and marketing. We facilitate our sellers opening their own “discerning eye��? to envision how their property might be perceived by others. We are at your service to assist in “staging” a home for its most advantageous presentation.

But the marketing process begins much earlier, by effectively attending to this checklist of items that should be completed in any home before it goes on the market.

Outdoors / Exterior:

• Clean up any debris around property. Make sure lawns and hedges are neatly trimmed and pruned. Clear away any dead plants.

• Clean all windows, inside and out.

• The entrance of any home makes the important primary statement about the rest of the house. Make the area in and around front door appealing, tidy and attractive.

• Touch up areas that may require fresh paint or wood stain

• Repair any loose drains, window screens, and all other noticeable items around a home’s exterior.

Garage:

• If it’s cluttered, clean and organize the area, throw out any unnecessary items stored there to create a more visually appealing appearance.

Living Areas:

• The interior of a home should not just look clean, but smell as fresh and clean as possible. If there are cat litter boxes, have the litter changed frequently, even daily. Subtle air fresheners – or, better yet, the aroma of freshly-baked goods – are excellent additions to the fragrance of a clean home, but don’t mask unpleasant smells (pets, moldiness, dampness) with strong perfumes. The most enticing environment is as clean and fresh as possible.

• Refresh areas that require attention. Paint or touch up where needed. Clean drapes, wash curtains, dust frequently, and polish all furnishings. Pets are wonderful, but there shouldn’t be obvious signs of their activities: vacuum up pet hair, clean up litter boxes (and keep in discreet places), and keep feeding areas clean and tidy.

• Replace any burnt out light bulbs, dust off lampshades and glass globes where needed.

• Organize bookshelves and closets, drawers, and cabinets. When showing a house for sale, clutter is never your friend! Neatly arrange items and tidy up areas, stacking boxes and arranging shoes and clothing in an organized fashion.

Kitchen:

• Sinks, counter tops, and appliances – surface and interior! – should sparkle. Clean out refrigerators and wash down the shelves and surfaces. Food storage drawers should be as clean as possible. Deep clean the inside surfaces of ovens (if possible, they should look as “new” as possible) and every nook and cranny of gas and electric ranges

• The floor should be scrubbed and waxed frequently, particularly with heavy use. All tiles should be clean and shiny and grout should be cleaned and bleached or, if needed, replaced.

Bathrooms:

• Mirrors should be shiny and clean. All bathroom surfaces should be clean and free of soap scum, mildew, hard-water stains. If grout and/or caulking can’t be cleaned or bleached, replace as necessary.

• Arrange and clean cabinets and drawers.

• Replace shower curtain and bath mats if needed.

• Fix any leaky faucets

Overall:

• Walk through your house with a critical set of eyes, trying to note areas that may lessen the positive impact of the home. Fix, replace, or rearrange anything that negatively catches your attention. Try to anticipate what a buyer will notice or find potentially objectionable. You know your home better than anyone and intuitively understand how to present it in its best light.

• Check all doors to make sure they don’t squeak or stick.

• Listen! Are there objectionable noises that need to be addressed and fixed? Remember, a menacing, barking dog can make buyers uneasy and nervous.

• Keep your house temperature set at a comfortable level. You may personally prefer it too hot or briskly cool, but potential buyers may not!

• Lighting makes a critical difference. Are rooms well-lit? Do lamps have appropriate bulb wattages? Check the views out of all windows in the home and remove items inside and out that may hinder or lessen the visual impact of the view.

Getting Your Home Under Contract

 Getting Your Home Under Contract….

“The Valley of Flowers”

It’s exciting for you, and for Stuart and Sally, when we find the property of your dreams, and you decide to go to the next step in the transaction process, by having us write a Buy/Sell Agreement. But what happens next?

What follows is a guide to a typical real estate transaction once Stuart and Sally submit and negotiate a Buy/Sell Agreement and the Seller accepts:

• Since you, as the Buyer, are making a major investment, it’s vital that you are fully versed in exactly what you are purchasing and any potential problems, hindrances or restrictions. Stuart and Sally will carefully, and thoroughly, go over each item within the Buy/Sell Agreement prior to your signing the document. We will also fully explain any counter offer from the Seller.

Once you have a fully executed Buy/Sell Agreement, it is prudent to engage a lawyer to examine your documents. Within the Buy/Sell Agreement are any number of Contingencies and Provisions. Each one has a specific Release Date. Stuart and Sally will negotiate, within the contract, ample time for you to satisfy each provision within the contract. We will also help keep the process on track, supplying you with names of qualified specialists to help satisfy a provision.

Should there be a problem with the time frame, we are usually able to amend the Buy/Sell Agreement and secure an extension of time. However, it is best to always remember that in Real Estate Contracts, Time is of the Essence.

• As the Buyer, it is your responsibility to provide Earnest Money. The amount varies due to Selling Price and Market.

Your check for Earnest Money is usually made out to the Title Company that is designated by the Seller. Montana law stipulates that you can not have a valid contract unless earnest money is involved. You will usually be paid interest on your money while it sits in an escrow account prior to closing or to the date when contingencies are released. Your earnest money will be refunded to you should you fall out of contract due to contingencies or fault of the Seller.

• The Seller of the property is responsible for providing and paying for the Title Insurance. If you, as Buyer, are financing the property, you will be required by your lender to provide the lender Title Insurance. You will receive a Preliminary Title Commitment and generally have 10 working days to examine, and accept, the provisions of the insurance. Stuart and Sally recommend that you have your lawyer go over the Title Insurance.

• Financing of the transaction is the Buyer’s responsibility, including the Appraisal of the property; in Montana, the typical appraisal fees vary between $400 and $700.

The Buy/Sell Agreement will contain release dates for the financing. As buyer, you must perform all tasks within these dates or risk falling out of contract. If you do require financing, then you will need to work with a lender of your choice.

It is prudent to obtain a letter from a lender stating you are qualified to purchase a property within a specific price range before you begin viewing properties with Stuart and Sally. Having pre-approval strengthens your Buy/Sell offer for negotiations. Stuart and Sally are happy to provide you with the names of local lenders. Terms vary from lender to lender and it is wise to obtain quotes from more than one source.

Lenders require an appraisal prior to financing, and they order the appraisal to insure its accuracy. Appraisals in the Gallatin Valley can take 3 to 4 weeks. Stuart and Sally will help arrange a time for a reputable appraiser to view the property. Should the house not appraise for the contract amount, Stuart and Sally will help negotiate a change in the price.

• It is the Buyer’s responsibility to seek Home and Property Inspections. The cost of these inspections range from $500 to $750 for a high-end home; this is determined by the age of the home, square footage, and location. Inspection for the potential presence of radon gas, which we urge you to do, generally costs an additional $100.

It is vital that you engage a qualified Home Inspector. Stuart and Sally will provide you with names of reputable local inspectors, schedule the inspection, and will be present during the inspection (which can take between 4 to 7 hours). After the inspection, Stuart and Sally will go over the results with you and after this, present an Inspection Notice to the Seller and negotiate any repairs or provisions required from the Seller due to the Inspection Report. This may involve a price reduction or a requirement for repairs or mitigation.

• The Water and Mineral Rights on the sale property may require both legal advice and, potentially, specialists in such matters; these issues are also the Buyer’s Responsibility. Water and Mineral Rights in Montana can seem like a daunting labyrinth of legal records and laws. It is the responsibility of the Buyer to determine how important the role of Water and Mineral Rights are in the negotiations for a property and then to accurately determine what rights convey. Stuart and Sally will include in the Buy/Sell Agreement that all rights appurtenant to the property will convey with the property, however it will be up to you to determine what these rights include. The property may have a stream running through it, but that doesn’t mean – and this is all too often the case! – the owner of the property has any right whatsoever to take any water out of the stream.

Also, wells and pond construction are regulated by the DNRC and the State of Montana, and, in many cases, Homeowner Associations. You need to know what your options are in regards to water before you purchase the property.

Flood plains are another consideration in purchasing a property in the Gallatin Valley. There are 100 year and 500-year flood plain maps available. If you can see or hear water, you must be aware of your risk for flooding. Engaging a qualified Hydrologist can help determine the best site for a new home or the risk potential of the property.

• Many properties in the Bozeman and Gallatin Valley area are connected to active Homeowner Associations. Stuart and Sally will provide you with any and all known Covenants for the Homeowners Association associated with your property. You will need to consult with your attorney to determine any restrictions and regulations that affect your intended use of the property.

• The Buyer generally takes possession of the property when the Deed is recorded. This is the day of closing if it is early in the morning, or the following day when the signing is in the afternoon. Stuart and Sally will arrange a final walk-through of the property prior to Closing to insure that everything is in tip-top condition and you are closing on what you have agreed to purchase.

• You will need to arrange to have a mover scheduled well before closing date as qualified movers are booked well in advance. Stuart and Sally will provide you with names of the most qualified movers. You will also need to arrange to have utilities and phone connected in your name.

• The Buyer’s responsibilities at Closing include any loan fees, as applicable. The proration of taxes and any special Assessments that are not the Seller’s Responsibility. Other responsibilities include insurance required by the Lender.

Closing Costs, which are generally split between Buyer and Seller, are generally under $300, or a $150 cost to the Buyer.

You will be provided with a closing statement prior to closing. The closing itself is a simple process of signing documents, which can take place in the Title Company’s office, or by registered mail with documents being notarized. You will be able, up until 10 or so days prior to closing, to determine which name or entity you wish to have the property titled under.

You will arrange with your lender or banker to have a certified check delivered to the Title company or the monies wired to the Title Company in the amount of the closing by the date of closing.

Congratulations! You are now a Gallatin Valley property owner.

Building Your Dream Home

“You see things and say,’Why?’ But I dream things that never were and I say,’Why not?” -George Bernard Shaw

BUILDING YOUR DREAM HOME

For many, the idea of actually committing to building the home of their dreams is too frightening and intimidating. But Stuart and Sally not only love building homes, they’ve followed their dreams and have been personally involved in numerous construction projects. Stuart and Sally understand the process that begins with the basic concept of what one’s very personal dream home might be like to the exciting day when the home is finished and the moving truck arrives to begin unloading the furniture. This is a unique process that takes, generally, between 18 to 30 months, but it all begins with desire. For many of our clients, the opportunity to move to the Bozeman community is also the inspiration for creating a very distinctive and personal home exactly suited to their lifestyle and family requirements.

It’s not unusual that new transplants to Bozeman or even natives seeking to finally live in their dream setting, ask Stuart and Sally to facilitate creating that special home, often starting by finding the ideal home site.

Working as a team, Stuart and Sally will obtain copies of any covenants and connect you with proper legal representation to insure that you can, indeed, build what you have in mind on that acreage.

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FROM THE GROUND UP

If you wish, we can also assist our clients in selecting the right architect. Bozeman and the surrounding area is home to many world-renowned architects; in fact, the deciding factor won’t be finding an architect, but the one who will best interpret and create your vision of your dream house.

Through experience, we have discovered that many times the architect and the style of the house will also dictate the best possible builder for the project. Bozeman and Big Sky are currently in the midst of a building boom, and finding competent, reliable contractors and sub-contractors is not always a given or easy. Because of our own construction projects and our relationships within the building community, Stuart and Sally know many of the builders, project managers, and property managers in Bozeman and the Gallatin Valley. We are able to facilitate your project to whatever extent you would like our expertise. As an example, Sally built her first 10,000-square foot dream home in Bozeman while she was still living in Kansas City.

Stuart first developed her interest in remodeling homes while still living in Washington, D.C. and has honed her skills while living in Bozeman. She has extensively remodeled two major Bozeman homes for her family. Both Stuart and Sally have direct knowledge of what needs to be done to build a beautiful luxury home while living far from the building site. Instead of being a daunting process, it can be a pleasurable task if done with proper guidance and planning, hiring the right team, and having the project properly supervised.

Stuart and Sally welcome the opportunity to help your dream become a reality! Below is a list of architects that we know, respect and, in many cases, have worked with ourselves, including links to their individual web sites.

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SELECTED ARCHITECTS

Van Bryan Studio Architects
Van Bryan has worked as Sally’s chief architect on four major projects in the Bozeman area. He has the ability to listen to a client and then create something that actually goes beyond what the client imagined.

Jonathan Foote & Associates
Jonathan Foote also has an international reputation and has been hailed as one of the first innovative architects to utilize reclaimed and recycled wood in his designs. Although he is now retired, architect Paul Bertelli has very ably filled his legendary role at this firm.

Bitnar Architects
Thomas Bitnar is able to interpret many styles, from classical to contemporary.

Cikan Architects
Frank Cikan’s work is wonderful.

Pricing and Presentation are Paramount

Setting the Stage for a Successful Sale or Pricing and Presentation are Paramount

Published in the Bozeman Chronicle, April, 2008. Traditionally, the onset of spring is the beginning of the busiest home buying and selling season. So if you have been waiting for the weather to turn, now is the time to think about readying your property to be put on the market. With a larger inventory of homes currently on the market than in the past few years, it is more important than ever to ensure that your home stands out from the crowd within its appropriate price range. First, pricing your home correctly from the onset is essential to successful selling. As soon as you decide to put your home on the market, it becomes a commodity for sale and must be viewed and marketed as such. Determining a competitive, reasonable offering price is the key to a timely sale. Knowing the background of comparable sales in the neighborhood is obviously important, but it must be coupled with the supply and demand for the location, size of the home, etc. The home’s condition is another consideration when comparing to other homes that are currently on the market. If the competition is all in move-in condition, and your home is in need of updates, the price must be willing to reflect this. Also keep in mind the timeframe in which you honestly need to sell the home. If urgency is imperative, then you may need to price it on the low end of the proper price range in order to move more quickly. Finally, take note that when homes are overpriced at the initial time of listing and have undergone several price reductions, they often end up selling for even less than their worth. Next, take some time prior to placing the “For Sale” sign in the front yard to complete home improvement projects, improve the exterior appeal, and stage the interior of your home. All are essential to get the attention of today’s buyer and will certainly pay off in terms of final sales price and time on the market. If you have been in the middle of one or several do-it-yourself projects, it is definitely time to finish them up prior to potential buyers viewing your home. Curb appeal is a much used term, but the importance is paramount. If the prospective buyer is not compelled to actually get out of their vehicle and walk up to the front door, it doesn’t matter how much potential the home has. Once a buyer has decided to view the home, the first impression must make a huge impact. Hiring a staging professional is certainly an option if your budget allows. A home stager can make the most of your personal belongings or bring in furnishings that will best showcase your home’s possibilities and bring out the maximum value possible in the home. Generally speaking, the cost of this service is almost always less than the initial price reduction of an unsold, listed property. Montana Home Staging and Staging Spaces, companies servicing the Bozeman and surrounding area, both offer a wide variety of services with the goal of turning a “house hunter into a home buyer.” Staging has been on the rise in recent years with statistics to back up its effectiveness. The payoff can truly be great. One local staging company is credited with transforming a home that was sitting on the market for 12 months into selling in 4 weeks. National statistics show that staged homes generally sell in ½ the time of unstaged homes. Additionally, according to a 2007 survey published by homestagingresource.com, the cost of professional home staging can garner a 343% return on investment in terms of increase in sales prices. Furthermore, 91% of real estate agents nationwide now recommend this service. These numbers are both up from the same survey in 2003 when the return on investment was estimated at 169% with a 76% agent recommendation rate. In fact, the only category that received a higher return on investment is “Clean and De-clutter” due to the fact that the cost involved is so minimal. Small changes can really make a big difference when positioning your home as the best deal in your price range. If buyers leave your property with a memorable impression of it, you will have a much better chance of selling your home at the best possible price in the shortest amount of time, which is very important in this competitive market. Keep in mind that being proactive is the best first step to a successful real estate sale. Robyn Erlenbush is owner of ERA Landmark Real Estate (with offices in Bozeman, Big Sky, Livingston and Clyde Park) and Intermountain Property Management. She can be reached at robyn@eralandmark.com.  Visit us at http://www.eralandmark.com/ & http://www.stuartandsally.com/

Second Century Acquires ePropertyData

 

Daily Real Estate News | March 10, 2008

Second Century Acquires ePropertyData

THE NATIONAL ASSOCIATION OF REALTORS® has acquired ePropertyData, a major provider of commercial information exchange (CIE) services for the commercial real estate industry.

The acquisition was accomplished by NAR’s new for-profit subsidiary, Second Century Ventures LLC, a strategic private equity fund that was conceived to help support NAR members in emerging technologies and services.

“Through this acquisition, NAR will provide its members with two important new services — a robust national commercial real estate listing and transaction platform, and a broker-centric solution provider for the CIE industry,” says NAR President Dick Gaylord. “The national listings and transactions platform will give our commercial members national exposure for all their sale and lease listings and provide the industry with an excellent and trusted resource to search for properties across the country.”

For the past five years, ePD, based in Gig Harbor, Wash., has been providing CIE services to the commercial real estate industry. ePD operates two of the largest CIEs in the country, CommercialMLS.com, on behalf of the 4,500-member Commercial Brokers Association in Seattle, and CommercialGateway.com for the 2,000-member commercial division of the Houston Association of REALTORS®.

Read More…

 

Why now is a SMART time to buy!

Daily Real Estate News | March 11, 2008

Why Now is a Smart Time to Buy
Now is a great time to buy a home, say the financial gurus at the Wall Street Journal.

The Journal calls it a buyers market and offers these suggestions for first-timers getting their feet wet. While their advice is solid, it’s not revolutionary, but some potential customers might find it reassuring.

Remember this is a place to live not a stock market investment, they say. Lenders want buyers to spend no more than 28 percent of their gross monthly income on mortgage payments, real estate taxes, and home insurance. Buyers shouldn’t count on stretching further because lenders won’t approve their loans.

Cash is king. Having enough money in the bank to pay closing costs that are typically an additional 2 percent to 3 percent of the price of the home is necessary.

Read More…

U.S. & Montana Economic Outlook – 2007

Bozeman and the Gallatin Valley have experienced steady, solid growth in both population growth and real estate values over the past decade.

Non-resident ownership of land in Montana was reported at 11% of property sales in the Gallatin
Valley in 2005. According to recently published U.S. Census Bureau figures, Gallatin Valley is the fastest-growing county in Montana, clocking a 19.3% growth rate between 2000 and 2006.
Economic predictions are that—if anything—Gallatin Valley will continue to grow at an even healthier pace.

• Economic Profile 2007 -
  Click here to download Prospera Business Network’s Economic Profile 2007

• Big Sky Market Report -
  
  Click here to download the Big Sky Market Report provided by ERA Landmark   
  (for Fall 2007)

 

U.S. & Montana Economic Outlook

 

This “U.S. & Montana Economic
Outlook” presentation has been brought to you by First Interstate Bank
& Stuart and Sally Platinum Properties. Please feel free to contact us if
you have any questions. 

click here to view slide show

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• 
  
  2006 – 2007 Single Family Sales Information
• 
  
  2006-2007 Vacant Land Sales Information

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This
graph shows Residential Single Family Homes in Gallatin County as of February
2008

 amount
of inventory, average price, median price, and number of days on the market.

 

 

This
graph shows Vacant Land in Gallatin County as of February
2008

 amount
of inventory, average price, median price, and number of days on the market.

 

Updated 2/2008

So what is driving the fantastic growth of the Bozeman and the Gallatin Valley real estate market?

• The distinctive Montana lifestyle
• The limited quantity of available land
• The dynamic community of Bozeman

Bozeman has been named the #1 ‘Dreamtown’ by Bizjournals.com for its quality of life and business growth, edging out Jackson Hole and Durango, Colorado. Bozeman is a small college town with a sophisticated and cultured atmosphere. Despite its size, Bozeman boasts amenities that larger urban cities would envy. No matter what the season, there are a full range of activities to
enjoy, from world-class fly fishing to the thrill of skiing to attending a wonderful symphonic concert. Whether you are starting up a business, relocating a family, or just wishing to retire
or own a second home here: an investment in Bozeman real estate is a sound decision.

Surrounded by 5 mountain ranges, with national and state land edging right up to the city and county lines, land is finite, while the sense of space is vast. Land values reflect the
precious, limited nature of available acreage, while quality homes are in short supply. Bozeman real estate continues to appreciate as more people desire to live in a place relatively free
from crime, embraced by nature, unpolluted and stress-free, in which they can create and enjoy the benefits of a lifestyle unlike any other in America.

• 
  
  2006 – 2007 Single Family Sales Information
• 
  
  2006-2007 Vacant Land Sales Information

 

Conservation Easements – Bozeman, Montana

Montanans – both natives and transplants – all share a love for the rugged grandeur of this magnificent state. Our wide vistas, majestic mountains, rolling farmlands, and wildlife attract visitors from around the world, and nurture the souls of those of us who call Montana home. Recent years have brought an influx of people wishing to develop and carve out sections of land for profit or personal use. This has created valid concern for the future of the state, and with that, growing alarm over disappearing open space. 

Montanans are pro-active people and, consequently, many residents of the Big Sky Country are passionate about proper stewardship of the land and are involved in numerous non-profit organizations that are diligently working to preserve and protect all that we so love for our future generations. Montana calls itself “The Last Best Place” and with that in mind, we are committed to permanently protecting what we so enjoy. 

Conservation Easements, very favorable and attractive to land owners wishing to preserve their holdings for future generations, are available for enactment by working with and through one of Gallatin Valley’s many non-profit organizations. 

Stuart and Sally love the Gallatin Valley and encourage land owners to consider the future of the open lands in this community. As a board member of the “Gallatin Valley Land Trust” Stuart is actively working to insure the continued viability of our local eco-system. Many of our closest friends are involved in 501-C3 local organizations fighting to safeguard Montana’s unique environment. 

There are many reasons to place land under the umbrella of Conservation Easements: taxes, inheritance, and a desire to insure for perpetuity that the land remains unfettered by future development while allowing you enjoyment of the land. As a legally binding agreement, with specific rules and regulations, a Conservation Easement should be approached with full understanding and knowledge of what you receive in exchange for giving up certain rights on your land. 

Below are links to several organizations in the Gallatin Valley with representatives who would be delighted to discuss the personal impact a Conservation Easement will have on you and your land. 

• Gallatin Valley Land Trust
• Gallatin County Open Space Grant Program  
• Trust for Public Land 
• Conservation Land Network 
• Montana Land Reliance 
• Montana Wetlands Legacy 
• Montana Natural Resources Conservation Service
• Trout Unlimited
• Nature Conservancy

Don’t forget to visit our website and leave us comments on your visits and discoveries!

Second Home Paradise

Published in the Bozeman Chronicle, August, 2007.

Most people who follow the real estate market are well aware that housing sales in 2006 slowed down nationally after a phenomenal pace for five years. And while it holds true that the second home market as a whole witnessed a decline, the bright spot that emerged was a record-breaking year for the purchase of vacation homes.

The National Association of Realtors recently published the results of the 2006 Investment and Vacation Home Buyers Survey. Results show that the second home market slipped from 40% of residential sales in 2005 to 36% in 2006. To break that figure down further, investment home sales dropped by over 28%, yet vacation home sales rose 4.7% to a record 1.07 million. Additionally, vacation homes accounted for 14% of last year’s total residential purchases, which was up from 12% in 2005.

Real estate analysts were not particularly surprised by these numbers due to the fact that many of those involved in speculative real estate left the market in 2006. Therefore, investment sales dropped at a faster pace than the general residential market. Those buyers in the vacation home market are in a strong demographic group with lifestyle being the primary catalyst of their purchasing decisions.

So who are the vacation home buyers? The survey’s findings once again show that the typical vacation home owner is of the baby boomer generation. However, this year the median age decreased to 44 years old (from 52 years in 2005) with a median household income of $102,200. The properties purchased were a median of 215 miles from the homeowner’s primary residence, showing that accessibility is a key factor. David Lereah, NAR’s former chief economist, concludes that “The demographics favor vacation-home sales because large numbers of consumers are in the prime buying ages, and buyers want recreational property for personal use – investment is a secondary consideration.” This trend could certainly continue with 44.7 million baby boomers currently aged 40-49. These are the people who are now positioned to compel the market.

A quick look at where vacation homes are being purchased shows 25% in the Northeast, 13% in the Midwest , 38% in the South, and 25% in the West. Rural areas were the most popular at 29%, followed by 24% in resorts, 22% situated in the suburbs, and 10% were located in urban or city center areas. This correlates with vacation home owner’s desires to be near waterfronts (ocean, lake, and river), recreational or sporting activities such as skiing and golfing, resort areas, or mountain and other natural attractions. Additionally, there has been strong activity in towns with universities, especially those who are going the extra mile to cater to the active yet retired or semi-retired demographic.

The factor that sets apart vacation home buyers from the rest of the market is primarily the motivation for purchasing the home. An overwhelming 79% plan to use the residence for vacations or family retreats. Additional reasons, in order of response rate, included diversification of investments, use as a primary residence in the future, tax benefits, use by family member or friend, because they had extra money to spend, or to rent to others.

Although the investment home market showed significant declines, it still comprised 1.65 million sales in 2006. A brief synopsis of the typical buyer is a median age of 39 years old, earning an income of $90,250 and purchasing a home a median of 22 miles from their primary residence. Explanation for their purchase, in order of response rate, was seeking rental income, diversification of investments, tax benefits, use for vacations or family retreat, having extra money to spend, use by family member or friend, and use as a primary residence in the future. The majority of investment properties are located in the suburbs with most activity occurring in the Southern part of the United States .

It bears repeating that Bozeman , Big Sky, Livingston and Paradise Valley are ideally situated to take full advantage of this long-term trend. Our proximity to Yellowstone National Park , world-class fishing, multiple ski resorts, championship golf courses and Montana State University spell the perfect combination for a strong vacation home market for years to come.

Robyn Erlenbush is owner of ERA Landmark Real Estate (with offices in Bozeman, Big Sky, Livingston and Clyde Park) and Intermountain Property Management. She can be reached at robyn@eralandmark.com. All thanks to Robyn for this article!

State of the Rockies

A quick look at the parking lots of the local hardware and home improvement stores in town gives us an indication of the amount of both “do-it-yourself” and “large scale” remodeling projects taking place in this area. Homeowners take pride in where they live, and the “to do” lists for most seem to never get shorter. Whether you are sprucing up your home for resale value or just wanting to increase your current enjoyment, there is information available on which types of projects should provide a better return on your investment.

Each year, Remodeling magazine produces an annual report which compares construction costs with resale values for many of the most common remodeling projects throughout the nation. This is the 19 th year that the report has been published; however, this year’s “Cost vs. Value Report” has seen a number of improvements in the way that data is compiled as well as a change from four U.S. regions to nine. If you would like to view the entire report, it is available at costvsvalue.com for a small fee. There are a variety of factors that actually come in to play when figuring the “cost recouped” for a particular house including the condition of the rest of the home, the value and availability of comparable properties in the immediate area, and the property values as a whole in the surrounding area.

Overall, and as expected, prices for the majority of remodeling projects have risen while the actual dollars that can be recouped when selling the home have declined. This comes as little surprise due to the record breaking activity levels we have witnessed in the past several years in both home sales and remodeling. Even with the current year’s declines, the numbers are still quite impressive. Considering the increased value at the time of resale, a home improvement project may only cost 20 cents to 25 cents on the dollar. According to the report, 75 cents to 80 cents of each dollar spent on a home improvement project are actually recaptured in the form of increased equity.

Replacement projects rate high when measured by cost recouped at resale. One possible reason is energy efficiency in these times of high fuel prices. For example, replacing old windows not only saves money while still residing in your home, but also makes it very appealing to potential buyers when the time comes to sell. However, aesthetics is also a key motivator on choosing which projects to take on. The power of a great first impression is one reason to consider replacing old siding and windows.

So, which remodeling projects should you consider if return on your invested dollars is important? In the Mountain Region, which includes Arizona , Colorado , Idaho , New Mexico , Utah , Wyoming , and Montana , a few key areas stand out. Adding a two-story addition won out as the most profitable remodeling venture, with 88.3% of the cost being recouped at the time of sale, nearly 5% higher than the national average. However, it can also be one of the highest investments dollar-wise, and therefore it can be somewhat prohibitive for many. Performing a minor kitchen remodel, bathroom remodel, or finishing out a basement also were viewed as a good choice in that they all were rated just above 86% for cost recouped, which was slightly higher than seen throughout the nation. Replacing windows, either with wood or vinyl, showed strong numbers at 85-86% which was very close to the national average.

The two projects that finished at the bottom of the list for the Mountain Region are the addition of a sunroom (65.1%) and the remodeling of a home office (60.9%). These numbers were just a bit below the national averages.

Whatever the rationale for undertaking a major project, whether it is for ease of maintenance, beauty, pure enjoyment, energy efficiency or resale, it is certainly a great benefit to be able to recoup the majority of your expenses in the process. As our market conditions have changed, now is a good time to engage a reputable builder to assist you. Always ask for written bids and local current references from other remodeling projects and consult with your local realtor on which projects have the most impact in our marketplace. Using this information, along with choosing a knowledgeable builder and realtor, can assist you in making the right improvement choices and obtaining the very best price when the time to sell does arrive.

Published in the Bozeman Chronicle, June, 2007 by Robyn Erlenbush

Robyn Erlenbush is the owner of ERA Landmark Real Estate (with offices in Bozeman, Big Sky, Livingston and Clyde Park) and Intermountain Property Management. She can be reached at robyn@eralandmark.com.

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