Mesa County real estate sales slow

Phil Castle, The Business Times

Robert Bray
Annette Miller

Real estate sales have slowed in Mesa County as the effects of the coronavirus pandemic and associated restrictions begin to show up in monthly statistics.

While some restrictions have lifted, it could be months before sales rebound.

“I don’t think we’ve seen the end of the decline,” 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, said the real estate market varies with the labor market. “We’re not going to see 2020 reach its full potential until everyone’s back to work.”

Miller said 374 real estate transactions worth a combined $117 million were reported in Mesa County in April. Compared to the same month last year, transactions fell 17.3 percent and dollar volume dropped 9.3 percent.

Two large transactions closed in April, Miller said — an RV park on 22 Road for $4.3 million and 10-acre commercial property on 21 1/2 Road for $1.3 million. But seven transactions accounted for a total of $17 million in April 2019.

According to numbers tracked by Bray Real Estate, 257 residential real estate transactions worth a total of nearly $80.6 million were reported in April. Compared to the same month last year, transactions fell 19.4 percent and dollar volume retreated 6.5 percent.

Bray and Miller said closings constitute a lagging indicator of  sales contracts reached anywhere from four to six weeks or even more beforehand. Consequently, the full effects of the coronavirus pandemic and related business restrictions and stay-at-home orders might not show up in real estate closings until May or June.

While the restriction since has been lifted, real estate agents weren’t allowed to schedule showings. Open houses are still prohibited, Bray said. Closings have continued with restrictions, Miller said. In some cases, her company conducted closings in the parking lot outside the office, passing documents through car windows.

Despite declines in April, transactions slipped only slightly year to date and dollar volume increased.

Miller said 1,467 transactions worth a collective $451 million were reported during the first four months of 2020. Compared to the same span in 2019, transactions decreased 1 percent and dollar volume increased 1.3 percent.

Bray said 1,049 residential transactions worth a total of more than $313 million were reported. Transactions fell 1.2 percent while dollar volume increased 6.9 percent.

The median price of a home sold during the first four months of 2020 climbed to $275,000. That’s a 10.9 percent increase over the same span in 2019 and exceeds what Bray said has been a 7 percent to 8 percent upward trend.

The decline in real estate sales could continue for several months, but Bray said pent-up demand persists. Moreover, interest rates on mortgage remain attractive at 3 percent or less.

“The sky’s not falling on the real estate market. It’s a consequence of an earlier restriction.”

Miller also expects real estate sales to increase as pent-up demand is unleashed, but the extent will depend on quickly people return to work and how many do so.

Meanwhile, property foreclosure activity continues to decrease in Mesa County. Miller said 62 foreclosure filings and 16 sales were reported during the first four months of 2020. Compared to the same span in 2019, filings fell 14.3 percent and sales dropped 68 percent.

The 12 resales of foreclosed property during the first four months of 2020 constituted just 1.1 percent of all transactions, a fraction of the 10 percent threshold Miller considers indicative of a healthy market.