Busy real estate season off to fast start

Annette Miller
Annette Miller
Kevin Bray
Kevin Bray

Phil Castle, The Business Times

What’s traditionally the busiest season for real estate activity in Mesa County is off to a fast start with year-over-year increases in transactions and dollar volume.

“We took a nice big step into the summer activity,” said Annette Miller, senior vice president at Heritage Title Co. in Grand Junction.

Kevin Bray, development coordinator at Bray Real Estate in Grand Junction, said sales of existing homes have picked up, but so has construction of new homes. “It seems like there’s been quite a bit of activity.”

Miller said 472 real estate transactions worth a combined $104 million were reported in Mesa County during May. Compared to the same month last year, transactions increased 13.2 percent and dollar volume jumped 20.9 percent.

Two large transactions accounted for a total of $2.4 million, Miller said: the sale of 560 acres of agricultural land on DS Road for $1.25 million and the sale of industrial property along H Road for $1.15 million.

Through the first five months of 2016, 1,672 transactions worth a total of $382 million were reported, Miller said. Compared to the same span in 2015, transactions rose 9.6 percent and dollar volume  climbed 16.8 percent.

Fourteen large transactions of more than $1 million each have accounted for a total of $35 million in sales so far in 2016, Miller said.

Bray said residential sales at Bray Real Estate through May were up 7 percent in terms of transactions and 20 percent in terms of dollar volume.

The summer and fall usually constitute the busiest time of year for the local real estate market, and May was no exception, Miller said. “It sure felt like it was a busier May.”

Low housing inventories and higher prices have brought more homes to the market and shortened the time many of those homes are on the market before they’re sold, Miller said.

According to the latest results of a monthly analysis conducted by CoreLogic, Grand Junction home prices edged up three-tenths of a percent from March to April and have increased 3.5 percent over the past year. The California-based research firm includes such so-called distressed sales as foreclosure sales and short sales in its calculations.

Bray said the low housing inventory also has prompted an increase in new home construction. Through May, the number of  single-family building permits issued in Mesa County so far in 2016 has increased 10 percent over the same span in 2015, he said.

That’s good news not only for the real estate market, but the overall economy, Bray said.

Miller said she expects real estate activity in 2016 to keep pace with 2015, although she’s less sure whether or not the increases will continue.

At the current pace, 2016 would end with 4,012 transactions worth a collective $917 million.

For 2015, 4,060 transactions worth a total of $984 million were reported. Those year-end numbers were the highest for Mesa County since 2008. The market last peaked in 2006, bottomed out in 2011 and has improved every year since then.

Unlike some areas of Colorado with what Bray described as “overinflated” real estate markets, the more moderate growth in Mesa County is sustainable, he said. “I think these are pretty solid numbers.”

If there’s a troubling trend in the local market, though, it’s an increase in property foreclosure activity.

Miller said 41 property foreclosure filings and 38 property foreclosure sales were reported in Mesa County in May. Compared to the same month last year, filings were down 10.9 percent, but sales were up 40.7 percent.

Those numbers bring year-to-date totals for 2016 to 235 filings and 152 sales. Compared to the same span in 2015, filings have increased 19.9 percent sand sales 35.7 percent.

Miller said increased foreclosure activity could be a result in part of people who’ve lost jobs in the recent slowdown in the energy sector related to low prices.

Still, the 109 re-sales of foreclosed property through the first five months of 2016 constituted only 6.5 percent of all transactions, Miller said. That’s well below the 10 percent threshold she considers indicative of a healthy market.