Market Update - May 2007

Through May of this year it is evident that there are numerous sales in the market, particularly related to higher end properties and that values associated with rural properties, particularly river properties are continuing to increase at a steady rate. The firm is currently tracking five sales in the $15,000,000 to $25,000,000 market relative to rural properties in Montana and Wyoming. These sales will exhibit increased values attributed to river properties and mountain foothill ranches. Interestingly three of five sales will be of properties which were not listed.

It appears that within the context of the current market, brokers have been approaching various owners about selling properties without gaining primary listing contracts. Some of the properties which are now selling are properties which have never been listed. As such, these properties are not affected by over inflated listing prices, which have been a problem, as reported in the 2006 land survey. This is reflective of the trend that there are just more agents working this market and many have hip pocket buyers that they are searching for. Also many listings may in fact be, as suggested in our newsletter, insincere listings. The parties are not really sellers, except at some over market value.

The large recreational sales indicate continued strength in the market relative to the recreational sectors of the market. However, large properties being purchased for pure speculative development have evidenced decreases over the past six months. Some of the fastest run ups in property values over the past several years have been for relatively marginal dry croplands and grazing lands which have been purchased for transitional tract development in fringe areas around the primary markets. Many of these properties have been re-exposed to the market in various configurations and the speculative owners of these properties are finding limited, if any, market demand for speculative tracts which lack water amenities, forest boundaries, or diversified underlying land assets such as irrigated cropland and riparian pastures.

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2005 Update