During the summer people lived in campgrounds for lack of affordable housing in Bozeman, and some University of Montana students camped out in lounges and dorm basements until housing could be found for them in Missoula last fall.
Housing stock is in short supply across Montana: Available rental housing stands at less than 1 percent in Bozeman and in Billings, and in Missoula the overall vacancy rate is less than 2 percent.
The current real estate boom is a complete turnaround for some communities that experienced a glut of housing in the 1980s. There was a housing surplus in Missoula as recent as 1989, according to Nancy Leifer, coordinator of the Missoula Housing Task Force. In Billings, "the '80s were pretty devastating" says Lucy Brown, executive director of the Housing Authority of Billings. "The market has miraculously reversed itself in four years," Brown says.
Still there is uncertainty about the future. Brown says Billings' lenders are a little reticent to invest in rental housing projects because they were stung in the '80s, and the future rental market is hard to assess.
The rental housing shortage is fed by an overall scarcity of affordable single-family homes. In Bozeman the average price of a single- family home is $118,000, but the median income in the city is $27,000. "That makes coming up with a down payment near impossible," says James Goehrung, neighborhood coordinator and grants person for Bozeman. In addition, land costs are high in Bozeman: An average residential lot runs from $35,000 to $50,000.
"People are looking for everything in Billings," Brown says. Property values have increased dramatically, and as a result, some single-family home owners who previously rented their properties are selling them. Brown says this cuts out a source of rental housing for large families.
The single-family home picture is worse than the short supply of rental housing in Missoula, Leifer says. "My sense of what's happening in Missoula is that it's becoming the Boulder, Colo., of the '90s," Leifer says. In the price range of $83,000 and below, fewer than 20 units appeared in the multiple listing in August. According to Leifer, based on population and income figures, the city needs 400 homes in that price range to meet the housing demand.
All three cities have task forces to cope with their new-found popularity. The Bozeman areawide housing task force is attempting to project future housing needs for the city's growing and changing population. In the meantime, two low- and moderate-income projects are planned: 50 units of owner-occupied and rental housing, and a coalition of local churches plans to build a nine-unit apartment complex.
In Billings two private multi-family housing projects, which will create 180 additional units, are on the drawing board. The Housing Authority is also looking at developing a smaller complex.
The Missoula task force was formed two years ago after University of Montana students began the school year living in tents on the university mall. Since then the task force has spurred the development of 450 new units of rental housing. About 220 units are university housing to accommodate the growing student population, which has increased by at least 1,000 since 1989, according to Leifer. And a non-profit community group is building a mobile home court run as a cooperative—the first of its kind in Montana.
At a recent statewide housing conference, Leifer says, reports of housing shortages came not just from the cities, but from small towns as well. "We've been discovered here," Goehrung says.
—Kathy Cobb
