Phil Castle, The Business Times

Mesa County real estate activity continues to lag behind last year as higher interest rates and lower residential inventories affect sales. The situation isn’t expected to change anytime soon, although home prices could rise further.

“We’re kind of in a holding pattern,” said Stewart Cruickshank, sales manager at Bray & Co. Real Estate based in Grand Junction.

Annette Young, administrative coordinator at Heritage Title Co. in Grand Junction, agreed. “It looks like we’re kind of holding steady.”

Young said 334 real estate transactions worth a total of $171 million were reported in Mesa County in August. Compared to the same month a year ago, transactions fell 15.7 percent and dollar volume declined 12.8 percent.

Ten transactions worth a total of $33 million bolstered dollar volume, Young said. They included the sale of the 144-unit Racquet Club Apartments for nearly $16 million, the single largest deal so far this year in terms of dollar volume. An office building in downtown Grand Junction sold for $4.6 million, while five units of newly constructed townhomes sold for a combined $2.35 million.

Through the first eight months of 2023, 2,508 transactions worth a collective $1.1 billion were reported, Young said. Compared to the same span in 2022, transactions dropped 28 percent and dollar volume fell 4.9 percent.

Young said higher interest rates on mortgages and low residential inventories have curbed activity. “There haven’t been any changes in those factors.”

According to numbers Bray & Co. tracks for the residential real estate market in Mesa County, 256 transactions worth a combined $111.3 million were reported. Compared to the same month a year ago, transactions declined 9.9 percent and dollar volume retreated 11.1 percent.

Through the first eight months of 2023, 1,873 transactions worth a total of more than $808.6 million were reported. Compared to the same span in 2022, transactions fell 20.5 percent and dollar volume decreased 19.6 percent.

Cruickshank attributed the difference to higher interest rates and lower inventories.

At the end of August, there were 491 active residential listings in Mesa County. That’s down 17.3 percent from the same time a year ago.

New home construction continues to lag as well. Through the first eight months of 2023, 304 building permits for single-family homes were issued in Mesa County. That’s down 45.5 percent from the same span in 2022.

Darah Galvin, director of operations at Bray & Co., said lending for new home construction has tightened even as builders also face shortages of skilled labor.

Meanwhile, homeowners in existing homes with comparative low-interest mortgages remain reluctant to sell their homes for fear of paying higher rates, Galvin said.

Cruickshank and Young said they don’t expect slowing in the Mesa County market to change until interest rates relent.

Demand for housing remains strong, however, pushing up home prices in the midst of low supplies.

The median price of homes sold in the first eight months of 2023 rose 1.3 percent on a year-over-year basis to $389,900.

For August 2023, 98.5 percent of homes sold received list prices. That’s down only a tenth of a percent from the same month last year.

Cruickshank said some nationwide forecasts for year-end home prices reflect no changes. But other forecasts call for increases of anywhere from 1.8 percent to 6 percent. Potential homebuyers waiting for prices to retreat shouldn’t, he said.

Property foreclosure activity in Mesa County constitutes something of a mixed bag, Young said. Through the first eight months of 2023, 160 foreclosure filings and 31 foreclosure sales were reported. While filings decreased compared to the same span in 2022, sales increased.