Something to cheer

By The Daily Sentinel 

A tighter inventory of homes for sale — especially those priced below $400,000 — has fueled a surge in new construction here in the Grand Valley.

A nine-year high in residential building permits is just one indicator of an improving housing market, the Sentinel’s Gabrielle Porter reported Monday.

The median home sales price was up 11 percent year over year from the previous January and there’s been an annual average increase in residential sales of 14 percent since 2010.

For a local economy still trying to find its footing in the wake of the Great Recession, these are positive signs. Understanding why real estate is enjoying an uptick in activity and value is a little tricky. Realtors and title companies can speculate, but the real estate market often reflects consumer perceptions rather than hard economic data.

The higher home median values point to greater confidence in the local economy. With persistently low interest rates, young and first-time homebuyers are seeing monthly mortgage payments on par with what they’d pay in rent. Add to that Mesa County’s growing reputation as a retirement destination and stability in certain employment sectors and you have real estate professionals beating the bushes to find homes they can list.

A revitalized concentration on economic development hasn’t hurt either — a factor one market watcher cited in his rosy outlook for 2017.

“We do not see a downside to market influences for 2017,” Bob Reece of Advanced Title Co. wrote in his year-end report. “Interest rates may edge up slightly but not to an extent to greatly affect purchasers of resale or new homes. Economic development has found renewed footing in Mesa County and we predict millennials taking a bigger role in new job growth. The broadband game plan will take shape and attract a new group of employees that choose to work remotely from the Grand Valley and eschew lunch for the Lunch Loop. There has been a slow-brewing new vibe in Mesa County and it will start to pay dividends for real estate sales and home building, and the economy in general.”

Let’s hope that home prices don’t get ahead of the economy and create affordability problems. For now, any positive developments with regard to the economy are welcome.