My husband and I recently took a trip to San Francisco. Neither of us had ever been there and we’ve heard so much about it so we wanted to see what it was all about. Overall I thought it was a tremendous city with tons to offer in terms of things to do, scenery, landmarks, architecture, restaurants, and so much more.
San Francisco real estate is closely followed since it is one of the most expensive markets in the world. Naturally while I was there I compared and contrasted that market with the Bozeman market. Here’s what I found:
Both Bozeman and San Francisco have a healthy mix of owner occupants and renters. Those who have owned real estate in both cities over several decades have done very well for themselves. Of course the market in SF is closely tied to the technology sector. As a result the price of real estate there has risen precipitously for 35-40 years. Bozeman’s quick rise in prices started a bit later, perhaps 15-20 years ago.
Bozeman is an expensive place to rent. However, when comparing to a place like San Francisco renters here look like they’re getting a good deal. In Bozeman, a person/family can obtain housing for $2,000 a month. Different story in San Fran. We had 2 different Uber drivers tell us they each pay $4,000/month to live in a studio/1 bed. Crazy, crazy world we live in. A quick search on rentometer.com shows a four bedroom place in San Francisco will average around $6,600/month.
As far as home purchases it’s the same story. Bozeman has certainly gotten more expensive but not compared to SF. A person in Bozeman can find a 2-3 bedroom starter condo for $200-250k. A starter condo in San Francisco will be somewhere in the $700-800k range. On the high end there are certainly some Bozeman homes that rival the price of most SF real estate. In fact, yesterday I walked through a $13M place just south of Bozeman…wow. There are certain neighborhoods in San Francisco where every home is worth $10M+.
San Francisco and Bozeman are somewhat similar because they are both desirable places to live. This should allow real estate in both locations to hold up well over time. One reason San Francisco’s prices have gone through the roof is because it is land-locked (water). Here in Bozeman we are locked in to a degree (mountains) but there is still a fair amount of buildable land in the valley.
After our trip to San Francisco I was excited to get back to Montana because I love it here. But seeing that city and how its real estate market has performed made me feel good about being a long term holder of Bozeman real estate. The world’s economy may have many ups and downs but I firmly believe that owning real estate in a desirable area such as Bozeman is a great place to be.
Last week’s trivia question: As of 4/20/17, what is the highest price of an actively listed home in the Bozeman area? Answer c) $12.9M
This week’s trivia question: What building is the oldest? a) Baxter Hotel, b) Ellen Theater, c) MSU’s Romney Gym