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Colorado Springs Real Estate Update January 2024

Posted by Sarah Steen on February 13, 2024
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infographic of Colorado Springs real estate stats for January 2024 including number of home sales, average sales price, and days on market

We can hardly believe it’s already mid-February! There is a lot to unpack for the real estate market so far this year and experts are already adjusting their 2024 forecasts. It is important to keep in mind that January statistics are the numbers that reflect December house hunting activity. This also explains why the sales numbers are low, since December and January are usually are slowest times of the year.  Let’s dive into the key takeaways from the recent market data.

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January Home Sales in Colorado Springs

Hyperlocal

We have mentioned that real estate is a hyperlocal industry, so keep that in mind when reading national headlines. Real estate markets on the East Coast and in California are already experiencing conditions similar to the hot markets of 2021. Colorado Springs is still thawing out from our typically slow winter season, but we saw a sharp, temporary uptick in market activity when interest rates dropped.

Home Sales

In January, the Colorado Springs real estate market experienced a 9.6% decline in home sales compared to the previous year. While this dip may raise concerns, it’s essential to consider the broader context and underlying factors driving market dynamics. Seasonal real estate trends and the lag effect of pending sales on closings influence sales numbers, especially following a slower December. Despite the decrease in sales volume, there are promising signs in the market.

Inventory

January also showed slightly more homes for sale than last year, but inventory remained tight which posed continued challenges for home buyers.  If your home is currently up for sale, you might be wondering why it hasn’t sold if there isn’t enough inventory. The short answer: home buyers have become very selective. High home prices, expensive interest rates, and the fact that the average homeowner stays in their home for 10 years mean that buyers have become more selective and less willing to compromise than they were during the frenzied years of the pandemic. Intentional updates and perfect maintenance are a must.

Average Sales Price

January’s average sales price for Colorado Springs came in at $522,379, just 0.5% over December’s average. We expected January’s sales and price numbers to continue to reflect the slower winter seasonal trends. We anticipate that inventory, sales and home prices will pick up as we approach the spring moving season.

Related Reading:
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Real Estate Market Trends to Watch

An Eye on Interest Rates

Despite our typical winter season slowdown, buyer demand increased quite strongly in January. This was fueled by temporary lower mortgage rates, favorable economic conditions, and a continuously growing population. The market pickup did not significantly change home prices or home buying behavior just yet, but even the short blip of 6.5% mortgage rates caused an increase in mortgage applications and home buying activity. This is an important trend to pay attention to if we have mortgage rates drop during the busy real estate season in Colorado Springs.

Related Reading: 10 Ways to Lower Your Mortgage Payment

Remote Work

The shift to remote work continues to reshape the way people live and work. There has been a noticeable shift in buyer preferences towards homes with dedicated office spaces, outdoor amenities, and flexible living areas. Buyers we work with are also prioritizing lifestyle factors by looking for properties that offer proximity to parks, trails, and recreational amenities.

Preparation and Pricing for Sellers

Diligent home preparation and strategic pricing are for crucial sellers trying to attract buyers. While Colorado Springs is still experiencing tight inventory, we are a far cry from a strong sellers market because there is lack of buyer demand while interest rates remain high. It’s possible that we will see multiple offers return in certain price ranges during the busy real estate season of March-July, but is unlikely that we will have the frantic market dynamics we experienced in 2021.

Related Reading: Trade Up Your Home in 2024

Corporate Investors

Rumor has it that some of the corporate buyers like Zillow will be listing their 300+ Colorado Springs single family homes. This could impact inventory and potentially pricing.

Regulatory changes and incentives

Developers have incentivized apartment construction in Colorado Springs. You might have already noticed all the new apartment complexes, including a proposed 36-story building close to downtown. We could see investors list their rental properties as a result of the possible rent volatility and new state regulations that favor tenants.  While Colorado Springs needs more rentals and affordable housing, investor flight decreases single family homes for rent and the amount of small housing providers (those that own less than 5 homes) that are generally more responsive than large corporations.

How is 2024 looking?

The January real estate market in Colorado Springs showcased resilience with increasing demand, limited inventory, and shifting preferences shaping the landscape. Staying informed and working with knowledgeable real estate professionals can help stakeholders navigate the complexities of the Colorado Springs real estate market and capitalize on emerging opportunities.

We are always by your side throughout your real estate journey. We don’t just sell houses – we take care of people. Need guidance on strategies tailored to your unique situation? Let’s have a conversation.