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Improving Real Estate Market in Big Sky Mirrors National Vacation Home Trend

Stan Feagler — Mon, 10 Jan 2011 15:38:00 GMT

The Wall Street Journal published an article today highlighting the improving market for Vacation homes in a number of resort communities across the country. Several of the trends noted in the article mirror what is happening in Montana's Big Sky Ski Resort.

In 2010, Big Sky saw overall sales transactions increase by almost 50% as buyers jumped off the sidelines, often with cash. The overall dollar volume of sales in Big Sky was also up, but by only 15% as the average price fell 17% between years. PureWest Christie's Great Estates agents in Big Sky say that buyers who have been watching on the sidelines now believe the bottom is probably behind us and are moving to take advantage of bargain prices still available.

The upward trend in vacation homes defies expectations for home prices nationally where experts are calling for a further decline of 5% - 10% in home prices due to excess inventory, foreclosure pressure and the difficulty in obtaining mortgage finance.

The difference with the vacation home market is that prices fell much further and much faster. In Big Sky, home prices are down from the 2007 peak by over 50% and while credit for vacation homes is often only available with crystal clean credit and 25% down, luxury home buyers are coming to the closing table with cash so as to not pass up deals in some of the nation's most exclusive resorts.

Buyers are oftentimes affluent baby boomers looking for a family gathering spot on holidays and a place they can semi-retire when the time is right. Technology is helping the trend as owners schedule longer and longer stays in their mountain locations making them a nice replacement office away from the city grind.

Stan Feagler, PureWest - Christie's Great Estates

Bozeman, Big Sky & Paradise Valley

By S. MITRA KALITA

Sales in many vacation communities across the U.S. soared last year to levels not seen since boom times, driven by deep discounts, cash purchases and buyers' rising stock portfolios.

On Mercer Island, Wash., waterfront sales nearly tripled in 2010, compared with a year earlier, reaching par with 2006 volume there. Sales on Hilton Head Island, S.C., rose 14% for the year. Palm Beach, Fla., experienced a 40% annual increase and a 54% increase in homes under contract, indicating an especially strong fourth quarter. Palm Beach sales volume now is comparable to its 2007 peak. These figures were gleaned by brokers in each locale.

"The proverbial train has left the station," said Ned Monell, an agent with Sotheby's International Realty in Palm Beach. "We haven't felt energy like this in a long time. Buyers sense that they've been on the sidelines long enough."

The question now is whether the momentum will last. The strength of second-home sales paints a stark contrast to the overall housing market, which is expected to worsen in 2011.

Existing-home sales in November rose 5.6% on an annualized basis, according to the National Association of Realtors, a trade and lobbying group. Last month, the Case-Shiller housing index of 20 cities showed prices across the U.S. fell in October, and most analysts predict another 5% to 10% slide in the coming year.

Data for the nationwide vacation-home market aren't tracked regularly. The National Association of Realtors conducts an annual survey of home buyers, but results for 2010 won't be out till March.

Yet the market for vacation homes, based on local sales data, appears to be booming. The comeback, NAR economist Lawrence Yun said, has been helped by gains in the stock market and an improving economy, which have made wealthier Americans more upbeat about the future. "It also implies that prices in some markets have come down so much that people are fighting for those properties," said Mr. Yun, noting that demand is strongest in areas close to stable labor markets.

According to the NAR, one in 10 real-estate transactions in 2009 was for the purchase of a vacation home. And though a small fraction of the overall market, it is significant because vacation homes are often big-ticket properties and attract discretionary buyers. Just four houses sold last year on Madeline Island, Wis., for example, but the island's average dwelling sells at two to three times the price of the county average, said Eric Kodner, a realty broker on the island.

Sales of second homes are showing an uptick even in more-affordable communities. In some locations, prices are even inching upward. Cape Cod sales climbed nearly 9% in 2010 from 2009, while prices rose 7%. Monroe County, Pa., in the heart of the Pocono Mountains, saw a 3% decline in transactions, but its Lake Naomi resort community was up nearly 15%. A one-acre plot off Lake Naomi recently fetched $1.1 million, a record deal for the area.

Still, in most markets where demand has improved, prices haven't. For Realtor Andy Twisdale in Hilton Head, S.C., it is too soon to rejoice; prices are down almost a third over the past five years. "People are buying at the very low end of the product," he said. "The financing is very difficult. Banks are requiring 25% down and crystal clean credit."

Buyers who qualify or can pay cash say this is the time to take the plunge. On New Year's Day, the Makarewicz family arrived in Pocono Pines, Pa., to look for a vacation home. They already own their primary residence in northern New Jersey and own a property in Damascus, a northeastern Pennsylvania town along the Delaware River. But the family says the latter doesn't offer enough things to do: Not enough shopping. Not enough activities for kids. Not even enough fish.

"How's the bass here?" Joe Makarewicz, a vice president for sales at a financial-services firm, asked Re/Max Realtor Rob Baxter as the two looked at floor plans.

The family plans to sell the Damascus house, which would allow them to pay cash for one near Lake Naomi. The resort community at Lake Naomi boasts pools, tennis courts, a recreation center and a golf course—and is equidistant from New York and Philadelphia.

Some second homes had been stuck on the market because sellers wouldn't budge on price; unlike owners of primary homes, they often aren't in a hurry to move.

"Sellers have become aware that they have to price their homes accordingly," said Harald Grant, a senior vice president at Sotheby's in New York's ritzy Hamptons region. "There's a perk in the market because a lot of prices have come down to where they should be."

This shift became clear to K. David Hirschey, who runs a consulting business in Minneapolis, as he hunted for a home on Madeline Island.

After competing in a summer swimming competition on the island, Mr. Hirschey decided to buy a home there, perhaps to rent it a few years and maybe retire there eventually. The first offer he made was rejected, he recalled, because the seller said, "We don't negotiate on properties here." The same thing happened with his bid on the next house.

Then he found a third property—four bedrooms, three baths—that began as a sale by owner, was taken off the market, then relisted under one broker, then another. It had been initially priced at $1.25 million, and remained on sale for two years.

"When I saw it, it was listed at $687,000," said Mr. Hirschey, a father of four children. He offered $530,000, furnishings included. "They wanted to negotiate and I said no," he said.

The tactic—an all-cash offer—worked, and Mr. Hirschey closed on the house in November, just in time for his family to spend the holidays there.

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Underwater Statistics May Be Overblown

Stan Feagler — Mon, 10 Jan 2011 02:57:00 GMT

It seems there are no very reliable measures of the number of homeowners who are underwater on their mortgages. Estimates nationanally range 20 - 25% but those may be overblown and certainly don't imply that level of "strategic defaults". The measures of borrowing are more accurate than the estimates of current home value. For example, only half of actual home sales fall within 10% of the Zillow estimate.

More importantly, many homeowners are only slightly underwater making it unlikely they will default.

Home prices in Bozeman, Montana have fallen 22% since their peak in 2006 but it is unlikely that the national statistic of 20 -25% underwater holds true in the Gallatin area. The Bozeman market was not characterized by a high percentage of zero down mortgages. Most of the underwater market problem has been concentrated in Flordia, Southern California, Nevada and Arizona.

The following is a re-post from the Wall Street Journal

Stan Feagler, PureWest Christie's Great Estates

Bozeman, Big Sky and Paradise Valley

Housing Statistics Hit Rough Waters

A widely repeated statistic on underwater homes could use a cold shower.

Several research companies track the troubling spread of negative equity—where the value of a home falls below the debt owed—as real-estate prices have tanked. And the number of such homes has risen from almost nothing during the housing market's peaks in the middle of last decade to nearly one in four U.S. homes with mortgages today.

Numbers Guy Blog

Underwater Homes Stat Springs Leaks

The statistic has been wielded by the media and public officials to paint a troubling portrait of homeowners trapped by crippling debt, unable to tap their homes for credit or to sell and move for jobs elsewhere.

But in a rare instance of mild good news in the housing market, the 1-in-4 figure, and the fear it provokes, seem overblown. It is calculated using assumptions in ways that inflate the number of underwater homes. And more than half of these homes are underwater by a small margin, meaning that for various reasons those homes are unlikely to trigger an epidemic of defaults.

"Everyone likes to get headlines, so they tend to overstate problems like this, without doing ground-level research," says Kenneth Rosen, chair of the University of California, Berkeley, Fisher Center for Real Estate & Urban Economics. "We probably overstate the number of people who are in trouble by quite a bit."

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Two of the most closely watched tallies on underwater homes use different techniques to estimate elusive quantities: Which homes have how much debt attached to them, and how much those homes are worth. A homeowner's equity is how much of the home she owns, calculated by subtracting debt from home value and dividing the result by home value. Those with negative equity are considered underwater. They make up nearly one in four homeowners with mortgages, according to the real-estate data companies CoreLogic and Zillow.com.

Before delving into the figures, it is important to realize that these estimates apply only to homes with mortgages. Such homes made up two-thirds of all homeowner-occupied housing units in 2009, according to the U.S. Census Bureau. So if 22.5% of homes with mortgages had negative equity in last year's third quarter, as CoreLogic reported last month, that means 15% of all homes were underwater.

The problem also is concentrated in several states. Arizona, California, Florida, Michigan and Nevada had about 31% of mortgaged homes but 53% of underwater ones.

The real number of underwater mortgages probably is lower than what these estimates suggest. That is because of the way the research companies estimate homes' value. Until a home is sold, its value is fuzzy. CoreLogic and Zillow approximate it by comparing it with nearby homes and similar properties that do sell. Each company regularly tests its valuation models against actual home sales, and makes sure that there is no bias in one particular direction, so that a home's value is just as likely to be overestimated as underestimated. Yet there is still some uncertainty in the calculations. CoreLogic says its estimate is within 10% of a sales price for between about 55% and 75% of homes, depending on the region. Zillow's estimate is within 10% of sales price almost half the time.

These margins of error tend to inflate the number of underwater homes for a subtle statistical reason. There are many more homeowners who are slightly above water on their mortgages than those who are slightly underwater. So if home valuations are flawed, there is a greater chance that homes are incorrectly pushed into the negative-equity category than the other way around.

"At the margin, that probably occurs," says Stan Humphries, Zillow's chief economist. "It's possible that would be the case," says Mark Fleming, CoreLogic's chief economist. Both say it would be difficult to correct for this problem. Dr. Fleming adds, "The truth is unknown."

Including homes with just a small amount of negative equity in the underwater category also overstates the problem. In practice, say housing experts, there is little difference between homes with a little bit of positive equity and ones with a little bit of negative equity.

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For one thing, homeowners might not know which category they are in. Also, there is little benefit to strategic defaulting when equity is near zero. CoreLogic's data indicate default rates begin to rise sharply at 25% or more negative equity—a group that represents less than half of underwater homes.

"At least as important" as the number of underwater homes, says housing economist Tom Lawler, "is the percent that are materially underwater. Would you seriously consider wasting your credit because you owe $5,000 more than you think your home is worth?"

Richard A. Smith, chief executive of Realogy Corp., the parent company of real-estate brokers Century 21 and Coldwell Banker, says the underwater total is an artificial number that means little except for homeowners looking to sell soon. "It's only an issue if tomorrow someone said, 'Everybody has to sell their house,' " Mr. Smith says. "We don't anguish over this number at all."

Write to Carl Bialik at numbersguy@wsj.com

Home Inventory Falls in December 2010

Stan Feagler — Mon, 10 Jan 2011 01:32:00 GMT

Reposted by Stan Feagler, PureWest Christie's Great Estates

Big Sky, Bozeman, Paradise Valley

Housing Inventory Declines

By Nick Timiraos

: See inventory data.

The number of homes listed for sale declined in December during the typically slow holiday season.

The supply of available homes for sale in 26 major metropolitan areas at the end of December was down 5.3% from November, according to figures compiled by ZipRealty Inc., a real-estate brokerage firm based in Emeryville, Calif. The data cover all single-family homes, condos and town houses listed on local multiple-listing services in cities where the firm operates. (See the inventory data.)

Home sales usually slow during the holiday season, and listings have traditionally declined by 11% in December from the previous month over the past 28 years, according to research firm Zelman & Associates.

For the year, listings were up 11%, according to the ZipRealty data. Sales surged during the first half of the year as tax credits enticed buyers to jump off the fence. But sales have plunged during the second half of the year, and sellers have been slow to cut prices to lure buyers back.

At the current pace of sales, it would take 9.5 months to clear the backlog of unsold homes, according to the National Association of Realtors.

In December, inventories fell in every market tracked by ZipRealty except for Orlando. The largest month-over-month declines came in Boston (-14.4%), San Francisco (-12.8%) and Washington, D.C. (-8.5%).

Only three markets tracked by ZipRealty posted year-over-year declines in listing inventory, and all were in Florida: Miami, Orlando and Jacksonville.

Follow Nick on Twitter for more housing-market news: @NickTimiraos

Mortgage Rates fall the First Week of January

Stan Feagler — Mon, 10 Jan 2011 01:20:00 GMT

Home-mortgage rates eased slightly last week after rising severl weeks in a row, according to Freddie Mac's survey of Mortgage Rates.

Rates have fallen for months in a row hitting rates not seen in decades but the problem for most borrowers availability. Treasuries have hit record lows bringing mortgage rates down as well and allowing those who can get money access to some of the cheapest capital in many years. sharp increases, according to Freddie Mac's weekly survey of mortgage rates.

Stan Feagler, PureWest Christie's Great Estates

Bozeman, Big Sky, Paradise Valley

See attached article re-posted from the Wall Street Journal

Rates had slumped for months, setting record lows in the process, as yields on Treasurys slid amid economic uncertainty. But yields began to rise near the end of last near, prodding rates higher. Mortgage rates generally track yields, which move inversely to Treasury prices.

Still, rates remain lower than they were at the beginning of last year, "which should help aid the recovery in the housing market," said Freddie Chief Economist Frank Nothaft.

The 30-year fixed-rate mortgage averaged 4.77% for the week ended Thursday, down from the prior week's 4.86% average and down from 5.09% a year ago. Rates on 15-year fixed-rate mortgages were 4.13%, down from 4.2% in the previous week and 4.5% a year earlier.

Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 3.75%, down from the prior week's 3.77% and down from 4.44% a year earlier. One-year Treasury-indexed ARMs fell to 3.24% from 3.26% and 4.31%, respectively.

To obtain the rates, the fixed-rate mortgages required payment of an average 0.8 point, the five-year adjustable required a 0.7 point, and the one-year required 0.6 point. A point is 1% of the mortgage amount, charged as prepaid interest

Bozeman Home Sales - Number of Transactions in 2010

Stan Feagler — Sun, 09 Jan 2011 20:15:00 GMT

Bozeman, Montana - In 2010 there were 529 home sales, up from a low of 462 in 2009. The majority, in fact 88% of transactions are sales under $500K. Transactions in this range were boosted by the home buyer tax credit while higher priced sales were hindered by lack of jumbo loan financing. There were 54 sales between $500k and one million compared with only 27 last year. In 2006 there were 109 sales in this price range, roughly four times the current level. There were ten homes sold for over $1.0 million in 2010 compared with over 20 in 2006 through 2008.

From a percentage standpoint, 88% of sale transactions were for homes priced under $500K and 96% are for homes priced under $750K. Only 2% of sales were for homes price over $1.0 million compared with 5% in 2007.

Bozeman Area SF Only Total Number of Sales
	2010	2009	2008	2007	2006	2005
Under $500K	467	427	418	443	517	702
$500K - $750K	42	23	45	72	83	79
$750 - $1.0MM	10	4	17	17	26	25
$1.0MM - $1.5MM	7	4	12	14	12	7
Over $1.5MM	3	4	10	10	12	3
Total	529	462	502	556	650	816

Bozeman Area Single Family Home Sales
*Percentage of Transactions*
Under $500K	88%	92%	83%	80%	80%	86%
$500K - $750K	8%	5%	9%	13%	13%	10%
$750 - $1.0MM	2%	1%	3%	3%	4%	3%
$1.0MM - $1.5MM	1%	1%	2%	3%	2%	1%
Over $1.5MM	1%	1%	2%	2%	2%	0%
Total	100%	100%	100%	100%	100%	100%

Some Say Housing Shortage in 2011

Stan Feagler — Sun, 09 Jan 2011 05:27:00 GMT

This past year saw an increase in the number of home sales transactions as well as an increase in the overall dollar volume of sales transactions in the Bozeman Area, Montana. Economists predict that a home shortage, or at least in certain markets, may materialize in 2011. While there are still record foreclosures, the number of people need housing continues to rise each year.

While some markets are down to 6 -7 months of inventory, Bozeman still has ample unsold homes. At the beginning of January, there were $343 million listings as compared to $178 in total sales during 2010. As in many markets, the sub-$500K priced homes are moving well but over $1.0 million is slow. See Bozeman Market Statistics for 2010.

Repost from Forbes.com

Economist: Housing shortage coming in 2011

He says that if new houses aren't built soon in the U.S., there won't be enough next year.

By Alexandra Zendrian of Forbes

more on Forbes.com

The focus of the U.S. real-estate market lately has been the number of foreclosures and people trying to purchase cheap housing. But Brian Wesbury, chief economist at First Trust Advisors, says that if Americans don’t start focusing on building new houses, the market will have a much bigger problem on its hands.

“We need one and a half million houses per year just to keep up with population growth,” Wesbury said in an interview with Steve Forbes. “And then if you throw in, you know, fires and tear-downs and just worn-out properties, we need 1.6 million or more per year. Right now, we’re down to about six and a half, seven months’ inventory whether you look at new homes or existing homes.”

Privately owned housing starts in December 2009 were at a seasonally adjusted annual rate of 557,000, according to the U.S. Census Bureau and the Department of Housing and Urban Development. This is 4% less than where it was in November, which had 580,000 housing starts.

Video: Is stimulus enough? Real-estate trends

Housing completion numbers also contribute to this dire picture, with privately owned housing completions reaching a seasonally adjusted annualized rate of 768,000 in December 2009. That was down 11.2% from the 865,000 completions in November and down 25.3% from the 1.03 million completions in December 2008.

MSN Money: Find a mortgage under 5%

Some people might shrug these statistics off, considering the number of foreclosures on the market. “Yes there’s foreclosures coming into the market, but we’re only starting right now,” Wesbury says. “... We’re starting one-third of the houses we need just to keep up with population growth, and that can’t last.”

On our blog, 'Listed': Rent is cheap now, but a shortage looms

There were 315,716 properties last month with foreclosure filings, according to RealtyTrac. These filings include default notices, scheduled auctions and bank repossessions. Though last month’s filings were 15% more than a year ago, they were 10% less than in December.

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Jason Thomas, chief investment officer for Aspiriant, a California wealth-management firm, says he doesn’t see the foreclosure situation getting better until the labor market picks up. “So many people are getting to a point where they just can’t hold on anymore, and we may see another wave of that if we don’t see a pretty robust turnaround in the labor market,” he says.

The unemployment rate is currently 9.7%, down from 10% at the end of 2009, according to the Bureau of Labor Statistics.

Thesis Fund Management portfolio manager Stephen Roseman says the likelihood of a housing shortage is slim to none. “You need to have an accurate housing turnover number, and right now we have anything but that,” he says.

There is some demand, though, from companies that are scooping up whole floors or housing developments because they have the cash on hand, Roseman says.

And for those people who can get a mortgage, homes are very affordable. The median price for U.S. existing single-family homes in metropolitan areas was $173,200 in 2009, according to the National Association of Realtors, compared with $198,100 in 2008.

Find foreclosures in your area

Mortgage rates are also very low. For instance, both JPMorgan Chase and Wells Fargo are offering 30-year fixed mortgages at 5%, and some can be found for a hair less.

“A mortgage is not difficult to get if you have the right income stream,” says Margaret Starner, senior vice president for the financial services firm Raymond James.

But even if you can get a mortgage, maintaining the income to pay for that mortgage isn’t easy. “There’s a lot of potential problems that can come out if unemployment continues to drag; people deplete their savings and their credit card,” says Michael Ervolini, head of behavioral finance at Cabot Research. “It appears to be more of an income issue than a housing issue that we’re going to be looking at for the next couple of years

Bozeman Area Single Family Home Sales Volume by Price Category for 2010

Stan Feagler — Sat, 08 Jan 2011 20:55:00 GMT

Bozeman, MT - Key home sales indicators begin to improve in 2010. The total number of sales, the total dollar volume of sales and the average home price all trended up in 2010.

The year 2009 was the lowest sales year from both a dollar volume and transaction number standpoint since 2005. That year was also characterized by marked slowdown in the sales of higher priced homes. As a percentage of sales, sales of homes priced under $500K climbed to 78% of sales from an average of close to 60% in the previous three years.

Bozeman Area Single Family Home Sales - $ Millions By Sales Level
	2010	2009	2008	2007	2006	2005
Under $500K	$127.1	$120.0	$127.9	$141.4	$169.5	$210.7
$500K - $750K	$24.9	$13.8	$26.9	$42.1	$49.1	$47.6
$750 - $1.0MM	$8.7	$3.2	$14.6	$14.2	$22.6	$20.9
$1.0MM - $1.5MM	$8.7	$5.1	$14.4	$17.4	$15.0	$8.0
Over $1.5MM	$9.0	$11.2	$23.2	$18.7	$24.3	$8.1
Total	$178.4	$153.4	$207.0	$233.8	$280.6	$295.2

Bozeman Area Single Family Home Sales - Percentage of Total Sales
	2010	2009	2008	2007	2006	2005
Under $500K	71%	78%	62%	60%	60%	71%
$500K - $750K	14%	9%	13%	18%	18%	16%
$750 - $1.0MM	5%	2%	7%	6%	8%	7%
$1.0MM - $1.5MM	5%	3%	7%	7%	5%	3%
Over $1.5MM	5%	7%	11%	8%	9%	3%
Total	*100%*	*100%*	*100%*	*100%*	*100%*	*100%*

The dollar volume of sales for homes price under $500K were $127K comprising 71% of the dollar volume. More typically, homes in this price range represent closer to 60% of total sales. Home sales over $1.0 million totaled $17.7 million for 10 transactions which is down from over $35 million in each year 2006 to 2008 when transactions averaged over 20 per year.

Stan Feagler

PureWest Christie's Great Estates

Bozeman, Big Sky, Paradise Valley

Bozeman Area Residential Sales in 2010 – Single Family Homes

Stan Feagler — Fri, 07 Jan 2011 21:41:00 GMT

Bozeman area home sales rise in transaction numbers, average price and overall dollar volume in 2010 reversing the downward trend of the previous five years.

Luxury Homes Going Green is Now a Trend in Big Sky, Montana

Stan Feagler — Fri, 07 Jan 2011 18:28:00 GMT

Advances in technology, products and methods have allowed luxury home owners to build at or near carbon neutral homes, even in relatively harsh climates. In Montana, cold weather patterns make common solutions such as photo-voltaics less practical but other techniques such a thermal exchangers, insulation, home siting and structural design efficiency for passive solar can pick up the slack.

Building in Mountain Resorts such as Big Sky, present additional issues for the green builder. Developers and builders take great care in site selection, materials selection and home design to maximize it’s efficiency. Architects such as Jerry Locatti and Candice Miller design luxury homes in Big Sky’s upscale resorts such as Yellowstone Club, Spanish Peaks and Moonlight Basin that are not only masterpieces consistent with the Montana vernacular, but also use energy, water and materials efficiently while maintaining ambient environmental quality.

Real estate agents at PureWest Christie's Great Estates have found an increasing number of home buyers taking into account the energy efficiency attributes of homes under consideration. The average return on investment for "green" building is measured at $50 to $70 per square foot over a 20 year period. While that may be a small relative to building costs in mountain resort communities, it helps justify what many custome home builders now include for socially responsible reasons.

See reposting from Wall Street Journal

By TARA LOADER WILKINSON

Even in a world where green has become the new black and words like "sustainable" grace everything from food packages to corporate mottos, the notion of building an eco-friendly luxury home can seem like an oxymoron.

IndigoPR Co

The luxury carbon-neutral home concept—in which properties attain a net zero carbon footprint—has been labeled "a conscience salve," "greenwashing" and "a complete misnomer" by critics.

"You think of a £30 million mansion built with the finest imported materials, the heated pools, the electrical gadgets, the air conditioning, the six-car garage and of course the private jet journey to get there. That can appear at odds with the environment," says Peter Mackie, managing director of HSBC-backed Property Vision, a U.K.-based estate agent.

The luxury carbon-neutral home concept—in which properties attain a net zero carbon footprint—has been labeled "a conscience salve," "greenwashing" and "a complete misnomer" by critics. Despite that skepticism, developers are hoping to turn a seemingly contradictory phrase into a 21st-century success story, laying plans for prime deluxe carbon-neutral property all over Europe. New homes in the U.K, Portugal, Italy, Morocco and Switzerland are being marketed to wealthy individuals around the world, with developers reporting strong demand.

In Morocco's Atlas Mountains, Anwar Harland-Khan, co-founder of green architect group Sustain Worldwide, is behind a carbon-neutral luxury development called L'Amandier. Construction of the project began last year and the villas are expected to be completed this year. All water will be drawn from on-site wells, and rainwater will be harvested for irrigation. Mr. Harland-Khan, who is also working on a Swedish carbon-neutral ski resort, says industry standards in Morocco are stringent and there are certificates provided to clients at each stage. Interiors, designed by U.K. and Moroccan architects Nick Gowing and Hicham Belhouari, have a flavor of Marrakech. Each villa has its own pool shaded by Bougainvillea and almond and citrus trees.

IndigoPR Co

Andermatt Swiss Alps, a major development overseen by Orascom Development Holding AG, which includes six luxury hotels, some 500 apartments and luxury villas and an 18-hole championship golf course.

Half of the sixteen villas, which are priced up to £425,000, have been bought before completion of construction. "Sustainable luxury is about providing for the needs of discerning people today, without compromising the needs of future generations," says Mr. Harland-Khan. "It is well within our grasp."

In the U.K., property developers John Hitchcox and Philippe Starck have launched the Cotswold's first carbon-neutral gated community, the Lakes by Yoo. The 160-villa development offers interior design by Jade Jagger and Kelly Hoppen. Villas are built using sustainable timber. There is an option for owners to purchase bolt-on solar panels, rainwater harvesting and wind turbines on their homes, with eco-packages priced up to £45,000. Properties cost between £800,000 and £1.5 million.

Meanwhile in Switzerland, the vision of Samih Sawiris, a billionaire Egyptian-born property developer, is taking shape. He is spending €1 billion to transform the sleepy village of Andermatt into a car-free community with over 500 apartments priced from around €1 million. Estimated completion is 2020. Half the energy for heating will be provided by wood fires, while the other 50% will come from geothermal energy.

Mr. Sawiris believes age and social conditioning can change perceptionswhen it comes to sustainability. "We are building with the well-educated next generation in mind. Carbon neutral will be important to them." He says he is footing the bill for the eco-credentials, which add a 10% premium to the project. "I feel I am setting an example," he says. "It is worth earning a bit less to have peace of mind. Reducing carbon should be everybody's goal."

Zero-carbon communities have been around for years—for example, the car-free neighborhood of Vauban in Freiburg, Germany, which was built in the mid-'90s and is characterized by rows of so-called "Passivhauses." The temperature in the homes is maintained through 30-centimeter thick insulation, airtight sealing and a heat recovery unit.

The problem is the aesthetics aren't everyone's cup of tea, says Property Vision's Mr. Mackie. Many carbon neutral homes take the form of prefabricated housing blocks built to a uniform height with little character. Buyers at the top end of the property market are rarely willing to sacrifice comfort and design for what they perceive to be unproven technologies in low carbon living.

"The eco-property movement has been hijacked by the 'woolly jumper brigade,' those that interpret eco-friendly as anticonsumerism, rather than reality," says Thomas Lipinski, an award-winning Polish architect and founder of Green Structures, a building firm. "The idea that these houses have to be ugly and badly designed is wrong."

Mr. Lipinski reckons that demand for well-designed luxury eco-homes will soar as carbon reduction will likely get more press and political attention. High demand will push prices higher. The resale value of a carbon-neutral property over 10 years could be 20% higher than a comparable "fossil build," he says.

His team is building a £400,000 zero-carbon country mansion in Hertfordshire for a client who initially contracted them for a standard home. When they suggested zero-carbon, he was skeptical. "He didn't like the idea of having to pay an extra 10%. But when I showed him how much he would save in the long run, and how much more he could sell it for, he soon agreed." Thermal and energy-efficiency related payback will take four years from occupation for an average home, taking into account new feed in tariffs on eco-homes in the U.K., says Mr. Lipinski. The mansion has a solar thermal heating system that can store up to 100 kilowatt hours of heat, a rainwater harvesting system and a heat recovery ventilation system.

But others believe technological innovations have a way to go before carbon-neutral luxury becomes standard. Charles McDowell, an estate agent in central London, points out that few top interior design firms are fully briefed on sustainability codes set by LEED (an internationally recognized green building certification system) or BREEAM (a voluntary measurement rating for green buildings established in the U.K.) Alex Michelin, director of Finchatton, a high-end interior design and development company, says: "The products out there are still far behind the labeling requirements set out under LEED and BREEAM. The whole supply chain—handles, fabrics, timber suppliers, electronics—all need to sign up to these codes before designers will have the information required to make informed decisions."

Although there are products that are both aesthetically pleasing and eco-friendly, there isn't as wide a selection on offer, and some of the products are one-time items, such as Lee Broom's Decanterlights, light fixtures made from lead crystal drinks decanters sourced from antique markets. "There are still major challenges in aligning the high-technology design features sought by buyers in the luxury market with sustainability, says Mr. McDowell. "With lighting, for example, most of the low-energy lighting systems are just not up to the standard demanded in this market."

The fact that most parts must be imported from Germany and Scandinavia is slowing progress too. Shelagh McMullan, a retiree living near Dublin, had a geothermal heater dug into her garden and solar panels fixed onto her roof. The implementation was arduous. "They sent the wrong size pipe from the company in Germany. We had to return it. It added another three months onto the process during which time my garden looked like a freshly ploughed field." But she wouldn't change the results. "Around 90% of my energy comes from the earth and the sun, my bills are next to nothing and my conscience is clear."

Real Estate Listings in the Bozeman Montana Area by Property Type at January 1, 2011

Stan Feagler — Wed, 05 Jan 2011 20:25:00 GMT

At January 1, 2011, condos and townhomes comprised about 30% of all properties on the Bozeman market and single family homes made up the remaining 70%.

	Condo	Townhome	Single Family	All Listings
Number of Listings	148	40	456	643
Percent	23%	6%	71%	100%

Total Listing Volume in Millions	$31.6	$9.6	$303.1	$343.8
Percent	9%	3%	88%	100%

Average Listing Price	$213,692	$239,837	$664,766	$534,616
Median Listing Price	$169,900	$184,950	$362,400	$294,500

Average Days on Market	177	340	208	210

Single Family Homes – Single family homes make up the majority of listings in the Bozeman Area, comprising 71% of the number of listings and 88% of the total listing dollar volume. The average listing price of single family homes is $664k due to the pull of higher priced homes on the overall average price. About 10% of the listed homes are priced at over $1.0 million and the highest listing is currently priced at $8.9 million. The mid-point or median for a Bozeman area property is $362K and the average home has been on the market 208 days.

Days on Market rises with price point. The graph below show that single family homes price under $300K average 165 days on market while the average climbs to 364 days or just over a year for luxury homes priced at over $1.5 million.

Single Family
Days on Market	Average	Mean
Under $300K	165	129
$300K to $750K	227	159
$750K to $1.5MM	256	227
Over $1.5MM	364	262

Condominiums make up a much smaller percentage of the housing stock in the Bozeman area, comprising only 23% of the number of listings and only 9% of the dollar listing volume. The average listing price of a condominium in the Bozeman area is $213K with a median of $170K.

Days on market for condos averages 179 (6 months) for price points under $300K but climbs to 255 days (about 9 months) when the price is above $300K.

Townhomes represent the smallest category of fixed residential unit in the Bozeman area. At the beginning of the year, there were 40 townhomes listed representing 9% of the overall listing count in numbers and only 3% of the dollar listing volume.

Townhomes also exhibit longer days on market than any other category with those priced below $300K at an average of 269 days and those above $300k averaging a staggering 787 days or 26 months (over 2 years).

	Single				All
Average Days on Market		Family	Condo	Townhome	Listings
Under $300K		165	179	269	180
$300K to $750K		227	255	787	252
$750K to $1.5MM		256			256
Over $1.5MM		364			362

*Bozeman Area including surrounding area such as Bridger Canyon, Trail Creek, Gallatin Gateway, Four Corners, North and Northwest of city.

**Source for all information is Gallatin Association of Realtors MLS

Stan Feagler - PureWest Christie's Great Estates, Montana Real Estate

Bozeman, Big Sky, Paradise Valley Montana