Mesa County real estate rebounds to five-year high
Phil Castle, The Business Times
While real estate activity continued to slow in Mesa County during December, year-end totals for transactions and dollar volume climbed to their highest levels in five years.
“Overall, I’m pretty encouraged about this last year and where we’re going to go,” said Robert Bray, chief executive officer of Bray Real Estate in Grand Junction.
Although Mesa County still lags behind other areas of Colorado in experiencing a more robust real estate market, decreasing foreclosure activity and low interest rates should promote some growth, Bray said.
Annette Miller, senior vice president of Heritage Title Co. in Grand Junction, expects a three-year trend of increased real estate activity to continue in 2014. But further gains in the real estate market will depend on improvement in the labor market, she said.
Both the number of real estate transactions and their combined dollar volume decreased in December on a year-over-year basis. Miller said 250 transactions worth a total of $52.8 million were reported in Mesa County. Compared to the same month last year, transactions declined 10.4 percent and dollar volume dropped 17.4 percent.
Miller attributed the difference in part to a strong month for real estate activity during December 2012 with several large deals. Just seven transactions accounted for $13.6 million in sales.
The number of real estate transactions declined on a year-over-year for the final three months of 2013, while dollar volume also dropped in November and December.
Miller said uncertainty over the effects of the new federal health care law likely prompted some people to put off decisions on home purchases until they knew how much they’d have to pay for health insurance. “It’s not an insignificant monthly payment.”
Bray said cold weather probably played a part as well in reducing the number of people who go to the showings and open houses that subsequently led to contracts and closings.
Nonetheless, the year-end totals for real estate sales in Mesa County were the highest in five years.
Miller said 3,589 sales worth a combined $769.6 million were reported during 2013. Compared to last year, sales increased 4.2 percent and dollar volume jumped 12.9 percent.
Those totals are the highest since 2008, although far below what was at that time still a robust real estate market that preceded dual downturns in the regional energy sector and overall economy. By comparison, 4,459 transactions worth a total of $1.3 billion were reported in 2008.
While slowing in real estate activity could extend into the new year, Bray and Miller expect continued improvement overall.
“I think next year will be another good year for residential real estate,” Bray said.
Bray anticipates a slight increase in the number of real estate transactions, perhaps as much as 2 percent, along with a 3 percent to 5 percent increase in median home prices.
While interest rates could creep up a half a percent to 1 percent, they will remain attractive at around 5 percent, he added.
Meanwhile, decreasing property foreclosure activity will exert less drag on the market.
Miller said 58 foreclosure filings and 34 foreclosure sales were reported in Mesa County during December. Compared to the same month last year, filings fell 12.1 percent and sales tumbled 45.2 percent.
Because of the time between filings and sales, the two don’t occur for an individual property during the same month.
Year-end totals for foreclosure filings and sales dropped dramatically from the year before. Miller said 793 filings and 592 sales were reported in Mesa County during 2013. Compared to 2012, filings retreated 36.7 percent and sales declined 29.8 percent.
The sales of foreclosed properties represented 18 percent of all transactions during 2013, down from 23 percent the year before, she said.