2021 Colorado Springs Real Estate Recap
Is it too late to wish you a Happy New Year? (Happy New Year!). 2021 left real estate professionals breathless: they were swamped navigating multiple offers on listings and they often submitted numerous offers for their buyers to try to snag a home in the competitive market. Our Colorado Springs real estate market usually has a slower season through the winter months, but we skipped that altogether last winter. Buyers started their home search and purchase activity in 2021 much earlier than usual. This resulted in an average home price jump from $430,000 in February 2021 to an incredulous $480,000 in April 2021. A dramatic home price increase like that had never been experienced before in all of Colorado Springs real estate.
Homes sold at dizzying speeds. Most months in 2021 saw listings going under contract within 3-4 days of coming on the market. Buyers had to be quick to see, decide and offer and then bend to seller requests. This was a stressful situation for buyers to navigate. The rental market was not much help as a backup plan because rentals were competitive to acquire and prices grew quickly.
What did December look like in real estate numbers?
We are noticing our traditional winter slow down here in Colorado Springs real estate with a bit less activity than other parts of the year. We still have low inventory, but December 2021 had nearly 5% more sales compared to December 2020.
Average Sales Price
Early 2021 had the previously mentioned huge average sales price jumps. But average sales prices have been hovering around $500,000 since June 2021, and December had an uptick to $505,000. The most important data to note is the 16% overall gain in average sales price year over year. 16% might not seem like a lot, but if you bought a home in December 2020 for $400,000, the same house would cost $464,000 in December 2021 with that 16% year over year increase.
Ready for some good news? We have about 25% more listings compared to this time last year. But there are still only 659 homes actively listed.
659 active listings is extremely low. If you are looking for:
*an existing home
*in El Paso County
The number would slide to about 350 homes to choose from. We need about 10 times that amount to have a balanced sellers/buyers market. Wondering if homes coming on the market due to forbearance might bring some relief? Most experts don’t expect the pandemic forbearance to have a noticeable effect on the real estate market.
Related Reading: Steps to Sell a Home
Looking forward: 2022
- Experts agree that a real estate downturn for 2022 is not likely. Opinions vary, but expect at least a 3-5% home price increase during 2022.
- New home builders are also adjusting to the supply chain shortages and will build premiums into their construction costs to account for unforeseen price hikes in labor or materials. If you’re building a new home in 2022, expect price increases during the construction of your home and/or delays of 2 months or more. Recently, a local home builder has even cancelled contracts just to rep-offer them to the same buyers at a $50,000 higher sales price. Your experienced REALTOR will be able to tell you more about what builders are doing and what to expect.
- Interest rates are expected to increase, particularly in the second half of 2022. This will leave some home buyers frustrated and dropping out of the market because of affordability challenges.
- Colorado Springs is a desirable place to be and it’s a growing city. The substantial military community brings buyers and sellers that churn the market each year during the busy moving season (usually late March-July). Other industries are bringing employment opportunities to the Springs, and there does not seem to be an end to the growth and influx of new residents needing housing.
Related Reading: How much is my home worth?
There is a new trend of homeowners are cashing in and leaving the state to pursue an area with a lower cost of living. This can be a very attractive option if you are not tied to a specific location. Depending on when you purchased your home, you could walk away with more than $100,000 that allows you to purchase a home in a new location with cash or a drastically reduced monthly payment.
Our recent home sellers have moved to Kansas, Oklahoma, Arkansas, Tennessee, and South Carolina. We have helped many of our clients make this move and would be happy to help you as well.
Related Reading: How much money will you make when you sell your home?
You might have to wait a long time (maybe years) if you decide to hold off on purchasing a home until prices come down. Real estate is still one of the best investments for yourself and your family. If the stock market tanks and companies go out of business you have nothing. Real estate at least provides a roof over your head. Losses and gains are only realized if you sell.
If you want to know more about a home purchase, and where to start, we’d love to give you guidance on how and where to start.
Related Reading: Steps to Buy a Home
Our team is always here to help and answer questions. If you want to learn more about how we help buyers buy and sellers sell, call 719-219-9739 or email firstname.lastname@example.org.