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GRAND JUNCTION — An economic malaise that has spread throughout the country and rekindled fears of a recession seems to have been unable to penetrate the region’s Teflon-like safety barrier provided by the oil and natural gas industry.
But there are signs the Western Slope took some hits in the first half of the year, with the potential for more should the nation continue to suffer from an infectious string of economic woes, such as record high fuel pump prices.
“When I moved here a couple of years ago I had to turn away work,” said Jeff Tanksley, who is a general contractor and owner of Mountain Top Construction in Grand Junction.
“I was busy ... I didn’t have to advertise. It (business) was going strong. Now, I am not seeing the same thing happening. I am seeing people afraid to spend their money. Instead of a total (home) remodel they are doing a room or two.”
The 20-year industry veteran added, “They are cutting back for a good reason — the uncertainty of the economy.”
One of the key drivers of that uncertainty, Tanksley believes, has been the meteoric rise in the price of retail gasoline, which has taken a big bite out of consumer wallets.
The average price of regular unleaded gas has increased more than $1 in the past year, and now stands firmly above $4.15 per gallon in Grand Junction, according to AAA Colorado.
“It’s a domino effect,” he said. “Once the gas prices started going up, it went to the grocery stores, the hardware stores and down the line.”
Regional economist Tucker Hart Adams, president of The Adams Group in Colorado Springs, said there is little if any doubt that consumer spending is being hampered by rising fuel prices. She said that helps discount retailers, such as Wal-Mart and Kmart, but can hurt smaller businesses that do not have the ability to match price points.
“People look for cheaper places to shop,” said Adams on the increased business for the discount retailers. “Gas is having an effect on food prices and some other things ... Consumers are being cautious.”
That caution has also spilled over into the local housing market, which by most measurements, seems to have slowed from its breakneck pace of recent years.
Zillow.com, which tracks home values in more than 150 regions across the country, reported that the Grand Junction metro area housing market experienced a 3.7 percent rise in the first quarter of the year.
That means through the first three months of this year, homes values in Grand Junction went up about $6,000.
While that would be great news for any number of beleaguered housing markets across the country, the figure was well below the overall percentage increase for 2007. Last year, Zillow.com reported, the median housing value in Grand Junction rose 9.6 percent to $213,000.
Figures for the second quarter ending June 30 should be released soon.
Nevertheless, some local real estate agents say they are getting a sense that qualified buyers seem unwilling to do deals.
“It seems like the people that can buy things are not. They are sitting on the sidelines,” said Mark Abbott, who is a real estate broker with Colorado Properties in Grand Junction. “And people who want to own stuff are not getting qualified.”
Abbott, a director of the Grand Junction Area Realtor Association, said the combination of the two has also led to twice as many listings on the market when compared with the same period a year ago and much longer selling times.
He said of the homes sold between April 1 and July 2 the “average days on the market” for those priced under $100,000 was 113 days, or nearly four months. Local homes sold in the $100,000 to $150,000 category took an average of 87.65 days to sell.
Those priced between $150,000 and $200,000 took 96.31 days to sell, while houses selling in the range of $200,000 to $250,000 took a staggering average of 147.65 days to move off the market, or roughly five months.
That translates to a lot of showings for agents, such as Abbott, who are hustling to move properties for their clients.
“I’ve had 25 showings on one house (alone),” said Abbott referring to a property on the west side of town that has garnered more looks from would-be buyers than any other home he has marketed in the area.
But he is confident housing activity is going to pick up in the months ahead, in part because the job market remains on solid ground. The latest reading from the Colorado Department of Labor and Employment pegged the region’s jobless rate at 3.6 percent.
That was easily the lowest in the state for May of the seven metropolitan areas that are routinely tracked by the department and below Colorado’s reading of 4.7 percent.
On the downside, the latest local reading was up three-tenths of one percentage point from April and nearly a full percentage point from the same period a year earlier.
However, Joseph Winter, an economist with the labor department, said those increases are somewhat misleading.
He attributed the rise in jobless rate to a couple of factors — “mud season” and a gain in the area’s labor force. Mud season applies to areas in the “state that have something to do with ski season,” Winter said.
That means when ski season ends in those markets, the labor force is flooded with new entrants because their jobs were tied to the industry. As a result there are more people looking for work, Winter said, including new residents.
Looking ahead, he said that “June is going to be an interesting month for the state and Grand Junction. I would anticipate things correcting back to your normal to near-frenzy jobs aplenty in Grand Junction.”
He added, “There’s a lot of gas in them there hills.”
But there are signs the Western Slope took some hits in the first half of the year, with the potential for more should the nation continue to suffer from an infectious string of economic woes, such as record high fuel pump prices.
“When I moved here a couple of years ago I had to turn away work,” said Jeff Tanksley, who is a general contractor and owner of Mountain Top Construction in Grand Junction.
“I was busy ... I didn’t have to advertise. It (business) was going strong. Now, I am not seeing the same thing happening. I am seeing people afraid to spend their money. Instead of a total (home) remodel they are doing a room or two.”
The 20-year industry veteran added, “They are cutting back for a good reason — the uncertainty of the economy.”
One of the key drivers of that uncertainty, Tanksley believes, has been the meteoric rise in the price of retail gasoline, which has taken a big bite out of consumer wallets.
The average price of regular unleaded gas has increased more than $1 in the past year, and now stands firmly above $4.15 per gallon in Grand Junction, according to AAA Colorado.
“It’s a domino effect,” he said. “Once the gas prices started going up, it went to the grocery stores, the hardware stores and down the line.”
Regional economist Tucker Hart Adams, president of The Adams Group in Colorado Springs, said there is little if any doubt that consumer spending is being hampered by rising fuel prices. She said that helps discount retailers, such as Wal-Mart and Kmart, but can hurt smaller businesses that do not have the ability to match price points.
“People look for cheaper places to shop,” said Adams on the increased business for the discount retailers. “Gas is having an effect on food prices and some other things ... Consumers are being cautious.”
That caution has also spilled over into the local housing market, which by most measurements, seems to have slowed from its breakneck pace of recent years.
Zillow.com, which tracks home values in more than 150 regions across the country, reported that the Grand Junction metro area housing market experienced a 3.7 percent rise in the first quarter of the year.
That means through the first three months of this year, homes values in Grand Junction went up about $6,000.
While that would be great news for any number of beleaguered housing markets across the country, the figure was well below the overall percentage increase for 2007. Last year, Zillow.com reported, the median housing value in Grand Junction rose 9.6 percent to $213,000.
Figures for the second quarter ending June 30 should be released soon.
Nevertheless, some local real estate agents say they are getting a sense that qualified buyers seem unwilling to do deals.
“It seems like the people that can buy things are not. They are sitting on the sidelines,” said Mark Abbott, who is a real estate broker with Colorado Properties in Grand Junction. “And people who want to own stuff are not getting qualified.”
Abbott, a director of the Grand Junction Area Realtor Association, said the combination of the two has also led to twice as many listings on the market when compared with the same period a year ago and much longer selling times.
He said of the homes sold between April 1 and July 2 the “average days on the market” for those priced under $100,000 was 113 days, or nearly four months. Local homes sold in the $100,000 to $150,000 category took an average of 87.65 days to sell.
Those priced between $150,000 and $200,000 took 96.31 days to sell, while houses selling in the range of $200,000 to $250,000 took a staggering average of 147.65 days to move off the market, or roughly five months.
That translates to a lot of showings for agents, such as Abbott, who are hustling to move properties for their clients.
“I’ve had 25 showings on one house (alone),” said Abbott referring to a property on the west side of town that has garnered more looks from would-be buyers than any other home he has marketed in the area.
But he is confident housing activity is going to pick up in the months ahead, in part because the job market remains on solid ground. The latest reading from the Colorado Department of Labor and Employment pegged the region’s jobless rate at 3.6 percent.
That was easily the lowest in the state for May of the seven metropolitan areas that are routinely tracked by the department and below Colorado’s reading of 4.7 percent.
On the downside, the latest local reading was up three-tenths of one percentage point from April and nearly a full percentage point from the same period a year earlier.
However, Joseph Winter, an economist with the labor department, said those increases are somewhat misleading.
He attributed the rise in jobless rate to a couple of factors — “mud season” and a gain in the area’s labor force. Mud season applies to areas in the “state that have something to do with ski season,” Winter said.
That means when ski season ends in those markets, the labor force is flooded with new entrants because their jobs were tied to the industry. As a result there are more people looking for work, Winter said, including new residents.
Looking ahead, he said that “June is going to be an interesting month for the state and Grand Junction. I would anticipate things correcting back to your normal to near-frenzy jobs aplenty in Grand Junction.”
He added, “There’s a lot of gas in them there hills.”
