Increasing activity bolsters real estate outlook

Annette Miller
Annette Miller
Todd Conklin
Todd Conklin
Dale Beede
Dale Beede

Phil Castle, The Business Times

Annette Miller used to describe her outlook for the Mesa County real estate market as skeptically optimistic. But after a strong first half with year-over-year gains in transactions and especially dollar volume, Miller has changed her assessment.

“The skepticism has been removed. It’s a solid optimism,” said Miller, senior vice president of Heritage Title Co. in Grand Junction and a long-time observer of the local market.

Still, others consider local conditions more of a mixed bag with some aspects of the market performing better than others. “It looks to me a little up and down,” said Todd Conklin, president and chief executive officer of Coldwell Banker Distinctive Properties based in Grand Junction.

Several large commercial transactions have bolstered dollar volume, but the commercial market remains overall a mostly normal one, said Dale Beede, managing broker of Coldwell Banker Prime Commercial Properties.

Miller said 412 real estate transactions worth a total of $139 million were reported in Mesa County during June. Compared to the same month last year, transactions climbed 8.4 percent and dollar volume jumped 51.1 percent.

The large gain in dollar volume was an anomaly, Miller said, attributed to the sale of the Mesa View and Atrium retirement communities in Grand Junction for a total of $45 million. Three other large transactions bolstered the dollar volume by another $10.75 million, she added.

Nonetheless, the June numbers continue what’s been a trend so far this year, Miller said. “It was a typical month for 2015, which is outperforming 2014.”

Through the first half of 2015, 1,937 transactions worth a collective $466 million were reported in Mesa County, Miller said. Compared to the first half of 2014, transactions rose 15.5 percent and dollar volume climbed 27 percent.

If that pace of sales activity continues, 2015 would end with 3,874 transactions worth a combined $932 million. Those levels would be the highest since 2008, although still lower than what was at that time an even more robust market.

Miller said she expects to see “more of the same” for the Mesa County real estate market in the second half of the year, including an increase in new home construction.

Miller said she’s further encouraged by decreasing property foreclosure activity. For June, 33 foreclosure filings and 28 foreclosure sales were reported. Compared to the same month last year, filings dropped 40 percent, although sales rose 27.3 percent.

Through the first half of 2015, 229 filings and 140 sales were reported. Compared to the first half of 2014, filings declined 22.4 percent and sales retreated 39.7 percent.

Resales of foreclosed property constituted just 7.5 percent of all transactions during the first half of 2015, indicative of what Miller considers a healthy market.

Conklin said the absorption rate of homes on the market has increased along with sales, although the inventory has held steady and prices have increased only a moderately over the past two years.

Conklin said he’d like to see more activity for homes priced in the $350,000 to $400,000 range, but also expects an increase in new home construction.

As for commercial real estate, Beede said conditions have exceeded his expectations given slow job growth in Mesa County. There’s interest among investors in commercial properties, although vacancy rates for industrial properties remain high, he said. “It’s just kind of a normal market.”

Low interest rates make it a good time to buy commercial real estate, Beede said. But it’s also a good time to sell for those whose properties are fully leased, he added.