Mesa County real estate sales top $1 billion
Phil Castle, The Business Times
Annual real estate sales in Mesa County have topped the billion dollar mark for the first time in eight years.
While rising interest rates could have an effect, the outlook for continued growth in the Grand Valley market in 2017 remains upbeat.
“I think it could be another good year,” said Robert Bray, chief executive officer of Bray Real Estate in Grand Junction.
Annette Miller, senior vice president of Heritage Title Co. in Grand Junction, also expects the market to continue to grow, albeit in single rather than double digits. “We’re still going to be in that positive direction, maybe just not so fast.”
For December, 358 real estate transactions worth a combined $89.7 million were reported in Mesa County, Miller said. Compared to the same month last year, transactions increased 5 percent and dollar volume rose 6.8 percent.
Seven large transactions worth a total of $12.4 million bolstered the numbers, Miller said, including the sale of a church and private school in Grand Junction to Colorado Mesa University for more than $4 million.
The December numbers bring year-end totals for 2016 to 4,592 transactions worth a collective $1.083 billion. Compared to 2015, transactions rose 13.1 percent and dollar volume climbed 10.1 percent.
Total dollar volume for 2016 was the highest in Mesa County since 2008, when more than $1.3 billion in sales were reported. Sales volume peaked in 2006 at $1.72 billion, bottomed out in 2011 at $585 million and has increased every year since.
Bray said residential real estate transactions in Mesa County were up 10 percent in 2016 compared to 2015, while the combined dollar volume of those sales grew 17 percent to $763 million.
The median sales price of homes rose 7 percent in 2016, but at $204,000 remained below the peak median price of $225,000 in 2008, he said.
A separate measure of the Grand Junction market also reflected year-over-year home price appreciation. According to the latest numbers from the California-based research firm CoreLogic, home prices decreased nine-tenths of a percent between October and November, but increased 4.3 percent between November 2015 and November 2016. The gain included such so-called distressed sales as foreclosure auctions and short sales.
Bray said 2016 exceeded his expectations. “It’s been a healthy, robust market.”
Interest rates on mortgages remained low and higher prices enabled some homeowners who previously owned more on their mortgages than the properties were worth to bring their homes to market. New home construction also increased, he said.
While Bray said he was concerned at the beginning of 2016 reduced inventories might slow the market, that didn’t happen. Supply outpaced growing demand and assured a good selection for buyers.
Looking ahead, Bray said rising interest rates could present a headwind in reducing the purchasing power of some buyers. On the other hand, the prospect of higher rates also could spur some potential buyers to take action. Either way, Bray said he expects real estate sales will continue to grow.
Miller agreed interest rates could affect the market in 2017, as could labor conditions. She also believes real estate sales will continue to grow, although perhaps not at the double-digit pace of the past two years.
Meanwhile, property foreclosure activity also increased in Mesa County during 2016.
For December, 52 foreclosure filings and 27 foreclosure sales were reported, Miller said. Those numbers brought the year-end totals for 2016 to 551 filings and 361 sales. Compared to 2015, filings increased 13.1 percent and sales jumped 20.7 percent.
Still, the 262 resales of foreclosed properties during 2016 constituted only 5.7 percent of all transactions, still well below the 10 percent threshold Miller considers indicative of a healthy market.