Some see another bad year for real estate sales
Real Estate West Managing Broker Tina Harbin has hoped every year since 2007 would be a better one for real estate in the Grand Valley.
Every year, she has been disappointed. And she doesn’t expect to feel much better about 2011.
“I think we’re going to be seeing a lot more of the same as we did in 2010,” she said.
That means low median home-sale prices, which Harbin is not convinced have bottomed out after hitting a low point of $176,000 in October, according to the Colorado Association of Realtors. It also means few sales — real estate sales fell 10 percent year over year to 2,452 in 2010, according to a local real estate report compiled by Advanced Title Company’s Bob Reece — and a growing stockpile of bank-owned properties, short sales and foreclosures.
The foreclosure process can take up to a year to complete, and filings, which signal the beginning of the process, are rolling in this year at the same pace they were most of last year, Mesa County Public Trustee Paul Brown said. The county ended 2010 with 1,580 foreclosure filings, just 20 behind the county record set in 1985.
“There was a period of time in the last part of August (2010), the first part of September, I thought, ‘Oh boy, we’re starting to see the end.’ But then it picked right back up,” Brown said.
The county processed 82 foreclosures in the first 20 days of 2011 and is getting 20 to 30 per week, according to Brown.
About 90 percent of foreclosed properties go back to a bank rather than sell at an auction at the Public Trustee’s office, Brown said. Dropping the price before an auction, which happens in about one-third of cases, doesn’t seem to help.
More likely, banks will end up trying to sell the homes through a Realtor. They may spend months trying to negotiate a price because they’re short-staffed, given the influx of homes going back to banks in the past couple years, Realtor Ed Stephens said. Stephens, who works for Century 21 Cole & Co., said some buyers won’t want to wait that long.
“Buyers are having a hard time waiting when there’s so much on the market they don’t have to fight with a bank over,” Stephens said.
Stephens said he also expects 2011 to be a lot like 2010, although he’s more optimistic than Harbin that prices have stabilized or gotten close to stabilizing. He said he has seen more interest from buyers in January than in December, which is positive, but he worries full-time, well-paying jobs are too few to push the real estate market back to a stable place.
“We have so much interfering with the return of the market I don’t see it coming back in 2011. Maybe at the end” of the year, Stephens said.
Unless something changes in the crippled local job market, Harbin doesn’t see much changing in the real estate world for the next two to four years.
“This may be how it is for several years,” she said. “The way we’ve done business in the past, I think, is gone. I don’t know that it will ever be as good as it was. In fact, I’m sure it won’t be.”
Harbin said her challenge with “the new normal” is to convince people home-ownership is still the American Dream and help them understand it’s a good time to buy if you have the money and can get loan approval. Harbin believes sellers also need to understand those who don’t want to negotiate on a sale price may not be able to sell at all, but buyers shouldn’t expect to get a house for next to nothing, either.