Sales of existing homes in Colorado fell in the second quarter, bucking a trend of rising sales nationally, according to a report Wednesday from the National Association of Realtors.
Sales statewide were down 6.4 percent between April and June compared with January to March, the fourth-largest decline among states.
Nationally, sales rose 3.8 percent between the two quarters.
“With low interest rates, lower home prices and a first-time-buyer tax credit, we’ve been seeing healthy increases in home sales, which are a hopeful sign for the economy,” said Lawrence Yun, the association’s chief economist.
Rising sales absorb the supply of unsold homes and can set the stage for price gains and eventual recovery.
Colorado was one of nine states, however, where home sales didn’t rise. But analysts were uncertain of what it meant.
“It is such a mix of everything going on,” said Michael Kone, an economist with Housingmetrics in Boulder.
Slower home sales aren’t necessarily a bad thing, especially if they result from fewer foreclosures and sales below the mortgage amount, which together accounted for 36 percent of home sales nationally, Kone said.
Home sales in Nevada are up 76 percent in the past year, but only because massive price declines from foreclosures have attracted buyers.
Mystery of Denver’s sales
In Colorado, what is hard to figure out is why the state sales numbers dropped so much in the second quarter when Denver sales were up. According to Metrolist reports for metro Denver, sales of existing homes rose to 11,204 from 8,159 in the first quarter. Denver-area sales make up a majority of sales statewide.
The discrepancy likely reflects a sharp decline in sales in parts of the state that have previously resisted the housing slump.
The national Realtors report doesn’t break out sales data for any cities or counties.
The Mesa County clerk and recorder’s office reported there were only 717 sales in the second quarter there, compared with 1,381 in the second quarter of 2008.
“Our market is off significantly from last year. We have gone from 130-plus drilling rigs down to the mid- 20s,” said John Huff, a partner with Coldwell Banker Home Owners Realty in Grand Junction.
Building permits there have gone from 1,200 permits a year during the boom days to around 400. Mountain resort areas also have seen housing demand slump as the appetite for second homes wanes.
Regional differences
Ryan McMaken, a spokesman for the Colorado Division of Housing, said a statewide foreclosure report for the second quarter shows the growth in filings is coming primarily from outside the Denver area.
Declining home sales could reflect a state divided between areas ahead and behind the curve on the housing downturn.
Markets that have resisted the downturn, such as Grand Junction, may be seeing sales slow as buyers and sellers try to find a price that works in a market headed south. In Denver and Greeley, where heavy foreclosures have taken their toll the past four years, the number of forced sales may be waning, Kone said.
Aldo Svaldi: 303-954-1410 or asvaldi@denverpost.com
