Phil Castle, The Business Times
At first glance, the charts resemble a mountain range with peaks and valleys, the ups and downs sometimes precipitous and sometimes gentle.
A closer look reveals the bars represent 30 years of history for the Mesa County real estate market, their heights varying with the number of transactions and combined dollar volume of sales for that year. The bars reach their highest for 2005 and 2006 and what was at that time a natural gas development boom in Western Colorado. The bars fall to their lowest for 2010 and 2011 and the bust that followed double dips in the energy sector and overall economy.
What’s happened since then has been a gradual slope back upward, a prolonged and what Annette Miller sees as a dissimilar and encouraging trend. “It feels like a much different recovery.”
Miller, senior vice president of Heritage Title Co. in Grand Junction and long-term observer of the local real estate industry, recently completed a special edition of her Real Estate Trends report reviewing the past 30 years.
A self-proclaimed geek for tracking real estate statistics, Miller considers the report a labor of love. But the numbers also offer a long-term perspective and the opportunity to draw connections between the real estate market and other economic forces, she says. “They’re all linked. You can’t buy a house without a job.”
The report nearly matches Miller’s tenure in the title industry. “This is pretty much my history.”
Miller began her career in 1989 when she answered a newspaper ad for an executive secretary and instead went to work in a title department. She says she’s subsequently worked in every facet of the business. In her present position, she manages a Western Colorado region that includes offices and staff in Grand Junction as well as Delta, Eagle and Steamboat Springs.
The title industry serves as a gatekeeper of sorts of important public records of property ownership, Miller says.
Title companies play a role in real estate transactions in reviewing and correcting errors in the ownership and legal descriptions of property and issuing insurance the title to a piece of real estate is legitimate, Miller says. Title companies also facilitate closings and file and record paperwork.
The process is a rewarding one, she says. “You’re helping people with the traditional homeownership dream.”
In addition, Miller has longed tracked trends in the Mesa County real estate market. She covers 30 years of trends in her special report.
For 1990, 3,885 real estate transactions worth a combined $279 million were reported. Those levels generally increased over the next 15 years even as natural gas exploration and production activities increased in Western Colorado.
The real estate market peaked with 7,198 transactions in 2005 and $1.72 billion in dollar volume in 2006.
Those levels dropped, though, with a downturn in the regional energy industry combined with the onset of the Great Recession triggered in part by a mortgage crisis. The Mesa County real estate slump bottomed out with 2,657 transactions in 2010 and $585 million in dollar volume in 2011.
The market subsequently recovered with year-over-year gains in transactions and dollar volumes every year between 2012 and 2018.
For 2019, 5,393 transactions were reported. That was down 5.7 percent from 2018 as low housing inventories curtailed sales.
But $1.67 billion in dollar volume was reported in 2019, up 7.7 percent from 2018 to its highest level since 2007. Dollar volume is affected not only by the number of sales, but also prices and large commercial transactions, Miller says.
New home construction as measured by the number of single-family building permits issued in Mesa County has gone through a similar cycle. Permits peaked at 1,483 in 2005, fell to 284 in 2011 and increased to 720 in 2019.
Unlike other areas of Colorado, the real estate market in Mesa County hasn’t yet rebounded to pre-recession peaks for transactions and dollar volume.
But Miller says the boom leading to the previous peak was based on energy production, while the latest recovery is based on steady growth in a more diversified economy. Moreover, the market also reflects more careful lending and banking practices. Both unemployment and property foreclosure rates remain low. “This growth is much different than that growth.”
Miller expects the upward trend to continue. Were it not for low housing inventories, the market likely would have surpassed the previous peak, she says. “If the inventory had been there, Mesa County would have been there.”