Trends

Phil Castle The Business Times

Even as rising interest rates on mortgages and seasonal slowing curtail real estate transactions in Mesa County, higher prices and big commercial deals push the collective dollar volume upward.

While 2022 might not keep pace with a record-breaking 2021, the market remains strong overall, local industry observers say.

“It’s still a healthy market,” said Robert Bray, chief executive officer of Bray & Co. Real Estate based in Grand Junction.

Annette Young, administrator coordinator at Heritage Title Co. in Grand Junction, said the latest numbers constitute a case in point. “I think that was a pretty solid May.”

Young said 520 real estate transactions worth a total of $236 million were reported in Mesa County for the month. Compared to May 2021, transactions declined 5.3 percent even as dollar volume surged 27.6 percent.

Just 24 transactions accounted for a collective $43 million, Young said. That included the sale of one commercial office building on Horizon Court in Grand Junction for more than $6.3 million and another building on Horizon Court for $3.1 million. A hotel on Horizon Drive sold for $5 million.

Through the first five months of 2022, 2,195 transactions worth an accumulative $940 million were reported. Compared to the same span in 2021, transactions fell 8 percent and dollar volume rose 16.5 percent. Ninety-one transactions in 2022 accounted for a total of $180 million, Young said.

According to numbers Bray & Co. tracks for the residential real estate market in Mesa County, 322 transactions worth a total of nearly $139 million were reported in May. Compared to the same month a year ago, transactions retreated 10.3 percent and dollar volume advanced 3 percent.

June 9-22, 2022 The Business Times News Page 19 Trends

INDICATORS AT A GLANCE n Business filings Contributors Fewer deals, more dollars t New business filings in Colorado, 43,780 in the first quarter, down 2.1 percent from the first quarter of 2021. For the first five months of 2022, 1,424 residential transactions worth a total of more than $594 million were reported. Compared Opinion Real estate trends diverge, but Mesa County market healthy overall to the same span in 2021, transactions dropped 11.3 percent and dollar volume climbed 5 percent. Bray said rising interest rates on mortgages have affected transactions. The difference would be more profound, he said, except nearly half of transactions involved cash rather than financing. Moreover, some seasonality has returned to the Mesa County market, he said. May closings reflect transactions in March and Business Briefs Business People Almanac n Confidence t Consumer Confidence Index 106.4 for May, down 2.2. t Leeds Business Confidence Index for Colorado, 53.9 for the second quarter, down 4.1 n National Federation of Independent Business Small Business Optimism Index April and what’s usually a slower time of year. 93.2 for April, unchanged. Fewer sales helped bolster inventory. At the end of May, there n Foreclosures were 365 active listings. That’s up 68.2 percent over the same time a year ago. That means more selection for buyers, Bray said. s Foreclosure filings in Prices continue to rise, however. The medium price of homes Mesa County, 16 in May, up from 2 in Robert Bray sold during the first five months of 2022 climbed to $380,000 up 19.1 percent from the same span in 2021. May 2021. Given the prospect of even higher interest rates affecting the t Foreclosure sales in ability of some buyers to obtain financing, Bray said he expects Mesa County, 0 in residential activity to continue to slow. Prices will continue to rise, May, down from but at slower pace, he said. 2 in May 2021. Commercial activity typically lags behind residential activity n Indexes t Conference Board Employment Trends Index, 119.77 for May, down 0.83. t Conference Board Leading Economic Index 119.2 for Annette Young and likely will remain strong, Bray said. Meanwhile property foreclosure filings continue to increase in Mesa County. Young said 16 foreclosure filings were reported in May, bringing to 120 the filings through the first five months of 2022. In contrast, there were eight filings during the same span last year. April, down 0.3%. Filings have increased since the forbearance imposed as a s Institute for Supply Management result of the COVID-19 pandemic ended, she said. Purchasing Managers Index A lot of those filings will be withdrawn, however, as owners for manufacturing, 56.1% for with equity sell before the foreclosure process is completed, she May, up 0.7%. said. n Lodging The four resales of foreclosed property during the first five months of 2022 constituted less than 1 percent of all transactions, s Lodging tax collections in below the 10 percent threshold Young considers indicative of a Grand Junction, $411,158 healthy real estate market. for April, up 84.1% F from April 2021. n Real estate

t Real estate transactions in Mesa County, 520 in May, down 5.3% from May 2021. s Dollar volume of real estate transactions in Mesa County, $236 million in May, up 27.6% from May 2021. n Sales

s Sales and use tax collections in Grand Junction, $6.6 million for April, up 6.6% from April 2021. s Sales and use tax collections in Mesa County, $4.5 million for April, up 4.6% from April 2021. n Unemployment

t Mesa County — 3.3% for April, down 0.6.

t Colorado — 3.6% for April, down 0.1. n United States — 3.6% for May, unchanged.

Consumer Confidence Index retreats

A measure of consumer confidence has retreated on less upbeat assessments of business and labor conditions.

The Conference Board reported its Consumer Confidence Index fell to 106.4 in May, down from a revised 108.6 in April. Components of the index tracking current conditions and the short-term outlook declined.

Lynn Franco, senior director of economic indicators at the Conference Board, said consumers don’t foresee the United States economy improving in the months ahead. “They do expect labor market conditions to remain relatively strong, which should continue to support confidence in the short run.”

Consumers also said they were less likely to purchase such big-ticket items as homes, cars and major appliances as well as go on vacations. Inflation and rising interest rates remain concerns, Franco said. “Looking ahead, expect surging prices and additional interest rate hikes to pose continued downside risks to consumer spending this year.”

The Conference Board bases its Consumer Confidence Index on the results of monthly household surveys. Economists monitor the index because consumer spending accounts for more than two-thirds of economic activity.

Lynn Franco

For May, less upbeat assessments of current business and labor conditions pulled the present situation component of the index down 3.3 points to 149.6.

The proportion of consumers responding to the survey upon which the May index was based who described business conditions as “good” rose three-tenths of a point to 21.1 percent. The share of those who said conditions were “bad” fell 1.5 points to 20.7 percent.

The proportion of consumers who said jobs were “plentiful” declined three points to 51.8 percent. The share of those who said jobs were “hard to get” advanced 2.4 points to 12.5 percent.

Less upbeat outlooks pulled the expectations component of the index down 1.5 points to 77.5.

The share of consumers who said they expect business conditions to improve over the next six months fell nine-tenths of a point to 17.7 percent. The proportion who said they anticipated worsening conditions rose 3.2 points to 24.9 percent.

The share of consumers who said they expect more jobs to become available edged up a tenth of a point to 18.5 percent. The proportion of those anticipating fewer jobs fell 1.1 points to 18.7 percent.

While 19 percent of consumers said they expect their incomes will increase, up 1.2 points, another 14.5 percent said they expect their incomes to decrease, up 1.3 points. F

The Business Times U.S. payrolls up, jobless rate steady

United States payrolls increased 390,000 in May as the national unemployment rate held steady at 3.6 percent for a third consecutive month, according to the latest U.S. Bureau of Labor Statistics estimates.

Estimated payroll gains for the previous two months were revised downward a total of 22,000 to 436,000 in April and 398,000 in March.

Nonfarm payrolls remained 822,000 below February 2020 levels and the onset of the COVID-19 pandemic in the U.S.

For May, 6 million people were counted among those unsuccessfully looking for work. Of those, 1.4 million have been out of work 27 weeks or longer.

Another 4.3 million people were counted among those working part-time because their hours were cut or they were unable to find full-time positions.

The labor participation rate — the share of the population working or looking for work — edged up a tenth of a point to 62.3 percent.

Payroll gains for May were spread out among industry sectors. Employment increased 84,000 in leisure and hospitality, 75,000 in professional and business services, 47,000 in transportation and warehousing and 36,000 in construction.

The average workweek for employees on private, nonfarm payrolls remained unchanged at 34.6 hours for a third straight month. The average manufacturing workweek slipped a tenth of an hour to 40.4 hours.

Average hourly earnings for employees on private, nonfarm payrolls rose 10 cents to $31.95. Over the past year, hourly wages have increased 5.2 percent.

F

Labor index slips

An index tracking labor trends in the United States has slipped, but continues to forecast job growth.

The Conference Board reported its Employment Trends Index fell more than eight-tenths of a point to 119.77 in May with declines in four of eight components.

Agron Nicaj, associate economist at the Conference Board, said several sectors have yet to recover job losses incurred since the pandemic, leaving room for additional growth. F