Mesa County real estate activity remains on pace to top 2011
Phil Castle, The Business Times:
Three quarters of the way through the year, real estate activity in Mesa County remains on pace to exceed last year in both sales and dollar volume.
Counting slight year-over-year increases reported in September, real estate transactions reported during the first three quarters of 2012 remain nearly 12 percent ahead of the same span in 2011. The collective dollar volume of those sales remains almost 13 percent higher.
“It’s just good to see that we’re continuing to stay at this level,” said Annette Miller, a senior vice president at Heritage Title Co. in Grand Junction who’s long tracked the local real estate industry.
Robert Bray, president of Bray Real Estate in Grand Junction, said what’s been a trend in increasing activity should extend through at least the fourth quarter. “I expect this year will end up ahead of last year.”
While property foreclosure filings in Mesa County so far in 2012 continue to exceed 2011, foreclosure sales have relented. The sales of foreclosed properties as a proportion of overall transactions also have declined.
Miller said 280 real estate transactions worth a combined $53.7 million were reported in Mesa County in September. Those numbers fell short of what was reported in August, but remain slightly ahead of what was reported in September of 2011.
If nothing else, September was shorter than August with 19 business days in which to record transactions as compared to 23 the month before, Miller said.
On a year-over-year basis, September sales edged up 1.4 percent and dollar volume increased 3.9 percent. The dollar volume increased even though four transactions worth a total of almost $7.6 million were reported during September 2011, Miller said. There were no sales over $1 million in September 2012.
Through the first three quarters of 2012, 2,573 real estate transactions worth a collective $502.9 million were reported in Mesa County, Miller said. Those numbers constitute a 11.7 percent increase in transactions and a 12.7 percent increase in dollar volume.
At the current rate, 2012 remains on pace for 3,340 real estate transactions worth a combined $670.5 million. If realized, those numbers would be the highest since 2008, albeit about half of those in 2007.
“Hopefully, we’ll see it continue to trend upward in the fourth quarter,” Miller said.
Real estate activity tends to slow on a seasonal basis between mid-October and mid-March. The upcoming presidential election has prompted some potential homebuyers to delay purchases, Bray said. Nonetheless, he also expects 2012 to finish ahead of 2011.
An unusual combination of lower prices and record-low mortgage rates has created a buyer’s market that’s not only bolstered sales of existing homes, but also helped to resurrect new home construction, Bray said.
But as inventories of existing homes, particularly on the lower end of the price scale, shrink, prices will migrate higher, he said. Property foreclosure activity likely will continue to influence the housing market as well.
Foreclosure filings were down in September compared to the same month last year. But the 1,000 filings reported through the first three quarters of 2012 represents a 10.5 percent increase over the same span in 2011, Miller said. Since filings occur at the beginning of the foreclosure process, they can offer a leading indicator of subsequent activity. For now, though, foreclosure sales continue to trend down.
The 60 foreclosure sales reported in September constituted a nearly 39 percent drop compared to the same month last year, Miller said. A total of 616 sales were reported through the first three quarters of 2012, a decrease of 13.5 percent from the same span in 2011, she said.
Sales of foreclosed properties as proportion of overall real estate transactions in Mesa County similarly have declined, Miller said.
In September, the sale of 54 foreclosed properties represented more than 19 percent of overall transactions. In the same month last year, sales of foreclosed properties constituted more than 30 percent of all transactions, she said.
Through the first three quarter 2012, the sales of 613 foreclosed properties represented nearly 24 percent of overall transactions. In the same span in 2011, the sales of 737 foreclosed properties constituted 32 percent of all transactions, she said.
Since foreclosed properties tend to sell for less than comparable properties on the market, foreclosure activity can pull down prices. In a good real estate market, the proportion of foreclosed property sales to overall transactions remains under 10 percent, Miller said.