Real estate market finishing strong in 2018

Annette Miller
Annette Miller
Robert Bray
Robert Bray

Phil Castle, The Business Times

While there’s almost a month left, 2018 will go down as another year of increasing real estate sales in Mesa County.

Industry observers expect the trend to continue in 2019, although a combination of factors could slow the pace of growth.

Annette Miller, senior vice president of Heritage Title, said she expects real estate transactions and dollar volume to keep increasing. “These are good gains, and I think we’re going to see them continue in 2019.”

Robert Bray, chief executive officer of Bray Real Estate in Grand Junction, said he also expects growth. But rising interest rates could combine with low residential inventories and higher prices to slow that growth. “It’s now joined that crowd.”

Miller said 428 real estate transactions worth a combined $128 million were reported in Mesa County in November. Compared to the same month last year, transactions increased 15.4 percent and dollar volume jumped 33.3 percent.

Large commercial transactions bolstered dollar volume with 10 deals worth more than $1 million each accounting for a total of $22.8 million. Storage units at 2739 U.S. Highway 50 in Grand Junction sold for $4.3 million, while an industrial warehouse at 841 21 1/2 Road sold for $3.85 million, Miller said.

The latest numbers bring total real estate transactions in Mesa County through 11 months of 2018 to 5,366 transactions worth a total of more than $1.45 billion. Compared to the same span in 2017, transactions rose 9.4 percent and dollar volume increased 22.8 percent.

Year-to-date transactions and dollar volume for 2018 already have surpassed 2017, when 5,331 transactions worth a total of $1.3 billion were reported.

While 2018 started out strong for real estate sales, activity lagged for a bit in the summer and fall before rebounding in November, Miller said. “It’s definitely a strong year, one with a lot of ups and just a few downs.”

Bray said 3,704 residential real estate transactions worth a collective $977 million were reported in Mesa County through the first 11 months of 2018. Compared to the same span in 2017, transactions increased 4.8 percent and dollar volume rose 14 percent. For all of 2017, 3,796 transactions worth a total of $922 million were reported.

Bray said he expects 2018 to end with a 4 percent to 6 percent increase in residential transactions. That’s less than a string of double-digit proportional gains over the previous three years.

Low housing inventories and higher prices have presented headwinds, Bray said. The number of active residential listings has decreased almost 9.9 percent even as the median price of homes sold in Mesa County has increased nearly 7.8 percent to $235,000.

Rising interest rates on mortgages could exert even more of an effect, though, in limiting how much homeowners can borrow and, in turn, spend. And that could affect the number of real estate contracts and closings, Bray said.

Looking ahead, Miller said economic trends and the growing attraction of Mesa County to people and businesses portend increasing real estate activity. “I think we’re going to see a lot of the same, with a nice step up in 2019.”

Bray said he expects the overall market to continue to do well with growth in commercial activity. But rising interest rates could slow the pace of growth for residential activity.

Meanwhile, property foreclosure activity continues to decline.

Miller said 21 foreclosure filings and only six sales were reported in Mesa County in November. Through the first 11 months of 2018, 245 filings and 146 sales were reported. Compared to the same span in 2017, filings fell 31.2 percent and sales retreated 48.2 percent.

The  89 resales of foreclosed properties through the first 11 months of 2018 constituted less than 2 percent of all transactions. That’s a fraction of the 10 percent threshold Miller considers indicative of a healthy real estate market.