Trends

November 11-24, 2021 The Business Times Page 15

Real estate numbers mixed

Transactions down, but dollar volume still way up in Mesa County

Phil Castle

The Business Times Even as the number of real estate transactions trends downward in Mesa County, higher prices and large commercial deals push dollar volume to record heights. Robert Bray, chief executive officer of Bray Real estate in Grand Junction, sees lower inventories and higher prices as villains in slowing residential sales, while new construction has become a hero in helping to meet demand. Looking ahead, Bray said there’s the potential for higher interest rates on mortgages to play a role as well. Annette Young, administrative coordinator at Heritage Title Co. in Grand Junction, agreed low inventories have slowed sales, but said the market remains busy overall. Young said 480 transactions worth a total of $204 million were reported in Mesa County in October. While transactions fell 17.1 percent compared to the same month last year, dollar volume rose 9.7 percent. Just 18 transactions accounted for a total of $49 million, Young said. They included the sale of an apartment complex on Knollwood Drive in Grand Junction for $10 million, the property where Tractor Supply is located for $5.5 million and a manufacturing warehouse and 20 acres where Grand Junction Steel was located for $5.5 million. Through the first 10 months of 2021, 5,191 transactions worth a collective $1.93 billion were reported. Just 145 transactions accounted for a total of $326 million. Compared to the same span in 2020, transactions increased 11.5 percent and dollar volume rose 34.9 percent. With two months still left in 2021, dollar volume already has topped the previous peak of nearly $1.73 billion in 2006. Transactions remain below the 7,198 reported in 2005. According to numbers Bray Real Estate tracks for the

INDICATORS AT A GLANCE

n Business filings t New business filings in Colorado, 38,211 in the third quarter, down 1.2% from residential market, 300 transactions worth a combined $109 million the third quarter of 2020. were reported in October. Compared to the same month last year, n Confidence transactions fell 27 percent and dollar volume dropped 23.2 percent. Year-to-date residential activity for 2021 still outpaces 2020, s Consumer Confidence Index however. Through October, 3,433 transactions worth a total of 113.8 in October, up 4.0. $1.3 billion were reported. Compared to the same span last year, t Leeds Business Confidence transactions increased 1.7 percent and dollar volume advanced Index for Colorado, 56.1 for 18.2 percent. the fourth quarter, down 11.2. Bray said lower inventories and higher prices have prompted t National Federation of some homebuyers to take a break from what’s been a competition Independent Business Small for listings with multiple offers above asking prices. Business Optimism Index Rising prices have made affordability a more pressing issue, 98.2 for October, down 0.9. Robert Bray he said. “You can’t keep up with that and not be affected.” n Foreclosures t Foreclosure filings in Mesa County, 1 in October, down from 2 in Residential inventories have picked up in recent months. The 392 active listings at the end of October constituted a 4.8 percent increase over the same time last year. Low supplies and high demand continue to push prices higher. October 2020. The median price for homes sold through the first 10 months of s Foreclosure sales in Mesa County, 3 in October, up from 2 in 2021 increased 15.1 percent to $328,000. New home construction has helped to meet demand, Bray said. A total of 793 single family building permits were issued in October 2020. Mesa County through the first 10 months of 2021, a 22 percent n Indexes Annette Young increase over the same span in 2020 on the way to what Bray expects will be a record year. s Conference Board Employment Bray said he expects the year-end number of residential Trends Index, 112.23 for transactions for 2021 to match or perhaps slip below 2020, but October, up 2.55. still considers 2021 a good year for residential real estate in Mesa s Conference Board Leading County. Commercial activity has been strong, he said. Economic Index 117.5 for Looking further ahead, Bray said interest rates on mortgages September, up 0.2%. remain historically low, but could edge up and eliminate some t Institute for Supply Management potential buyers. Purchasing Managers Index Meanwhile, property foreclosure activity continues to decrease for manufacturing, 60.8% for in Mesa County. Young said 22 filings and 18 sales were reported October, down 0.3%. through the first 10 months in 2021. That’s down 73.5 percent n Lodging s Lodging tax collections in Grand Junction, $177,537 for September, up 30.7% and 35.7 percent, respectively, from the same span in 2020. The seven resales of foreclosed properties in 2021 constituted less than 1 percent of all transactions, well below the 10 percent threshold Young considers indicative of a healthy market. from September 2020. F

News Trends Contributors Opinion Business Briefs Business People Almanac

n Real estate

t Real estate transactions in Mesa County, 480 in October, down 17.1% from October 2020. s Dollar volume of real estate transactions in Mesa County, $204 million in October, up 9.7% from October 2020. n Sales

s Sales and use tax collections in Grand Junction, $5.78 million for September, up 14.7% from September 2020. s Sales and use tax collections in Mesa County, $4.32 million for October, up 17.1% from October 2020. n Unemployment

t Mesa County — 4.8% for September, down 0.9.

t Colorado — 5.6% for September, down 0.3. t United States — 4.6% for September, down 0.2.

Small Business Optimism Index declines

A measure of optimism among small business owners has declined even as concerns over labor and inventory shortages mount heading into the holiday shopping season. The National Federation of Independent Business reported it’s Small Business Optimism Index decreased nine-tenths of a point to 98.2 in October. “Small business owners are attempting to take advantage of current economic growth, but remain pessimistic about business conditions in the near future,” said Bill Dunkelberg, chief economist of the NFIB. “One of the biggest problems for small businesses is the lack of workers for unfilled positions and inventory shortages, which will continue to be a problem during the holiday season,” Dunkelberg said.

The NFIB bases the index on the results of monthly surveys of members, most of them small business owners. For October, seven of 10 components of the index declined, one advanced and two remained unchanged from September.

The proportion of those responding to the survey upon which the October index was based who said they expect the economy to improve in coming months dropped four points. At net negative 37 percent, more respondents expected worsening conditions.

The component has dropped 17 points over the past three months to its lowest level since November 2012. A net 31 percent of respondents reported plans to increase capital outlays, up three points. A net 10 percent said they consider now a good time to expand, down a point. A net 26 percent reported plans to increase staffing, unchanged from September. A net 49 percent reported unfilled job openings, down two points from a record-high reading for the 48-year-old index. Asked to identify their single most important business problem, 24 percent cited labor quality and 10 percent labor costs. A net 44 percent of respondents said they raised compensation, a record-high proportion. A net 32 percent said they plan to raise Bill Dunkelberg compensation in the next three months. The proportion of those who said they expect more sales dropped two points to net zero. The share of those reporting higher earnings dropped three points. At a net negative 17 percent, a bigger share reported lower earnings. Among those reporting lower earnings, 31 percent blamed higher material costs and 25 percent cited weaker sales. Among those reporting higher earnings, 56 percent credited stronger sales. A net 8 percent reported plans to increase inventories, down a point. A net 9 percent said they consider current inventories too low, also down a point.

The Business Times

November 11-24, 2021 U.S. payrolls up, jobless rate down Labor index rises

Hiring rebounded in the United States in October as payrolls increased and the unemployment rate decreased.

Nonfarm payrolls grew 531,000 and the jobless rate slipped two-tenths of a point to 4.6 percent, according to estimates from the U.S. Bureau of Labor Statistics.

The latest payroll gain came in closer to the average monthly increase of 582,000 so far in 2021. Smaller payroll gains for September were revised upward a total of 235,000 to 312,000 and 483,000, respectively.

Employment has increased 18.2 million since April 2020, but remains 4.2 million below February 2020 and the onset of the COVID-19 pandemic in the U.S.

For October, 7.4 million people were counted among those unsuccessfully looking for work. Of those, 2.3 million have been out of work 27 weeks or longer.

Another 4.4 million people were counted among those working part-time because their hours were reduced or they were unable to find full-time positions.

The labor force participation rate held steady at 61.6 percent.

Payroll gains were spread among a number of industry sectors. Employment increased 164,000 in the leisure and hospitality sector, 100,000 in professonal and business services, 60,000 in manufacturing, 54,000 in transportation and warehousing and 44,000 in construction.

Employment decreased a total of 65,000 in state and local government education.

The average workweek shortened a tenth of an hour to 34.7 hours. The average manufacturing workweek decreased a tenth of an hour to 40.3 hours.

Average hourly earnings rose 11 cents to $30.95. Hourly earnings have increased 4.9 percent over the past year. F

An index tracking labor trends in the United States has increased, forecasting job growth.

The Conference Board reported its Employment Trends Index rose 2.55 points to 112.23 in October.

Gad Levanon, the head of the Conference Board Labor Markets Institute, said the unemployment rate likely will dip below 4 percent within the next six months and could reach a pre-pandemic low of 3.5 percent by the end of 2022. Labor shortages will persist and wages will rise. F