Real estate activity slow in first quarter

Annette Miller
Annette Miller
Robert Bray
Robert Bray

Phil Castle, The Business Times

What’s usually the slowest quarter of the year for real estate activity in Mesa County was even slower this year.

Year-over-year declines in sales and dollar volume in both March and January pulled down the overall numbers for the first quarter.

“You still see the slowness we’ve been hoping would go away,” said Annette Miller, senior vice president of Heritage Title Co. in Grand Junction and a long-time observer of the real estate industry.

But as the weather warms in the busier second and third quarters, so could the market.

Robert Bray, president of Bray Real Estate in Grand Junction, expects the market to hold steady overall for 2014 and come close to matching 2013 for the highest levels of sales and dollar volume since 2008.

“Being the same is still not a bad thing,” he said.

Miller said 250 real estate transactions worth a total of $47.6 million were reported in Mesa County during March. Compared to the same month last year, sales slipped 5.8 percent and dollar volume dropped 19.2 percent.

For the first quarter, 649 transactions worth a combined $133 million were reported. Compared to the same quarter last year, sales fell 10 percent and dollar volume declined 8.3 percent.

Miller said a number of factors likely contributed to slowing during the first quarter of 2014, including inclement winter weather and uncertainty over health insurance premiums associated with new federal law.

Labor conditions didn’t help, she added. The monthly unemployment rate in Mesa County spiked at 8.3 percent in January before edging down to 8.1 percent for February. March estimates haven’t yet been released.

Bray agreed cold weather played a role in reducing the number people who go to showings and open houses that subsequently lead to contracts and closings in the residential market.

While Mesa County entered the recession later than other parts of Colorado, the county also has lagged behind in the subsequent recovery, Bray added. “I think we’re lagging a little longer this time.”

There are indications, though, real estate activity soon will pick up.

“We’re already seeing that in the office,” Miller said.

Another encouraging factor is the continued decline in property foreclosure activity in Mesa County.

For March, 53 foreclosure filings and 40 foreclosure sales were reported, Miller said. Compared to the same month last year, filings dropped 23.2 percent and sales tumbled 46.7 percent.

For the first quarter, 148 filings and 137 sales were reported, Miller said. Compared to the same quarter last year, filings declined 18.7 percent and sales fell 23.9 percent.

The resales of 91 foreclosed properties represented just 14 percent of all real estate transactions during the first quarter of 2014. That proportion keeps moving closer to the threshold of 10 percent Miller considers indicative of a healthy market.

At the same time, home prices have increased, according to CoreLogic, a California-based firm that collects real estate data.

Including such so-called distressed sales as foreclosure sales, home prices in Grand Junction were up 4 percent in February compared to the same month a year ago. Excluding distressed sales, year-over-year prices increased 6.6 percent in February 2014 compared to February 2013.

Miller and Bray both said they expect year-end real estate numbers for 2014 to come close to 2013. Last year, 3,589 transactions worth a total of $770 million were reported in Mesa County. Those totals were the highest since 2008, although still far below what was at that time a robust market.

Meanwhile, though, it remains frustrating the figures for the first quarter of 2014 reflected a decline, Miller said. “I wish steady was a lot more steadier than it is.”