Building permits climbed to 3,321 in 2012
The piercing whack of nail guns and lumber ripping through table saws was likely more prevalent in the Grand Valley last year, according to the number of construction permits issued in Mesa County in 2012.
A total of 3,321 permits were issued last year, a few hundred more than in 2011. Last year’s numbers were more on par with the level of construction around the valley in 2009, during which 3,282 permits were issued.
Of note, builders created more single-family residential homes last year, 388, compared to 284 permits obtained in 2011.
“When you see those solid and rebounding numbers (of single-family residential permits) that’s a good market for the economy,” said Mike Mossburg, chief building official for Mesa County. “Once that is solid, you see a lot more employment. Contractors go out and buy trucks, they go out to eat.”
Mossburg said builders last year snapped up vacant, bank-owned lots that had fallen into foreclosure. Buying lots at reduced rates helped them maintain a competitive advantage, he said.
For example, lots previously priced at $70,000 to $80,000 sold for a high of about $30,000 last year, Mossburg said.
Grand Junction builder John Davis said 2012 turned out to be a good year. His business, Blue Star Industries, built about 70 homes last year, about its average over the past decade.
“I saw the tables turning in December 2011,” Davis said. “In about April of 2012, I kind of said to myself, ‘It’s turning from a buyers’ market to a sellers’ market.’ 2013 is going to be a much better year.”
Davis said the area’s hottest market is building homes in the $300,000 to $400,000 range, a trend that surprised him at first. He makes a habit of asking buyers a bit about their motives when buying homes his company creates. Recently, he said, buyers of his high-end homes say they are moving into the larger, more expensive homes and renting out the homes they were living in.
“I think Grand Junction is better than the nation in the fact that we’re on a natural growth cycle,” Davis said, adding that he thinks the area is moving away from the natural gas boom-and-bust cycles of the past.
The next challenge will be to find enough skilled employees to build homes, Davis said.
The past few years have damaging the construction business so much that an estimated 90 percent of builders in the Grand Valley have gone bankrupt or moved away, he said.
General contractor Dane Griffin expects a few more housing starts in the next two months. An increase in permits is encouraging, but it has been slow going. His company typically builds homes and light commercial buildings.
“Permits are going up, but not at the rate anybody wants,” he said. “The local economy has more to do with it more than the national economy. It seems like the Grand Valley is lagging behind the rest of the state.”
Single-family permits increased last year, but commercial construction was slow, with just 29 building permits. In 2011, the number was even lower at 23. It was a paltry 13 in 2010. In 2009, there were 48 commercial building permits.
The construction of residential homes may prompt more commercial construction, which is a common cycle, said Diane Schwenke, executive director of the Grand Junction Area Chamber of Commerce.
Schwenke said building trends, in general, track how confident people are feeling about the economy. News surrounding the nation’s debt and potential tax increases probably aren’t helping people feel more willing to build new homes or invest in infrastructure.
Construction permits are one indicator the chamber observes to gauge the general economy.
“I think it’s one of the several things that you look at,” she said.