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June 2019 Real Estate Market Trends in Colorado Springs

Posted by Sarah Steen on July 15, 2019
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infographic of Colorado Springs real estate numbers

Units sold down by 5%

This could send homeowners in a panic thinking “Has the bubble finally arrived?” We don’t see any reason for sellers to be concerned. When you compare 2018 to 2019, it’s obvious that the decrease in sales mainly comes from fewer sales in the price range under $300,000 in Colorado Springs.

Related Reading: Home Seller Frequently Asked Questions

Home Inventory is down by 1.9%

Interestingly enough, home inventory is down and there seems to be no relief in sight. However, many home sellers are having to wait a bit longer for an offer. This is an indication that buyer behavior is changing and buyers are sticking to their price limits.

Related Reading: Home Buyer Frequently Asked Questions

Home prices up by 3.4%

The moving season is in full swing. Home buyers are not shy to offer on their dream home when they’ve found it. Buyers are very aware of just how quickly certain homes sell in the Colorado Springs market.

Days on Market Increased by 3 days

The slight increase in days on market could be because of the influence of two factors:

1.  Many of the homes sitting on the market are in the higher price ranges and historically don’t move as fast.

2.  There are more new construction sales are on the market. This tends to push the days on market number up. Often times builders will list new construction homes while they are being built. This means they could sit in the MLS for months.

Housing Statistics should be Interesting this Year

The first quarter of the year saw average sales prices remaining fairly stable around $345,000. In April, they exploded to $370,000 and then stabilized through May ($371,000) and June ($373,792).

What’s unusual about these numbers when compared to previous years? The average home prices usually steadily increase to a pivotal maximum in June before slowly starting to decrease for the rest of the year. While June has had the highest price so far for 2019, the month to month price increases are lower when compared to previous years. A 3.4% home price increase was predicted for 2019 and that’s exactly where we are at right now in Colorado Springs.

While it seems that the market has cooled some which is evident in the many price reductions for listings, there is a huge shortage in homes listed under $300,000. We still see multiple offers and a lot of competition in this price range. For the month of June there were 485 sales of homes listed under $300,000. Only 19(!) of those were sales of homes under $199,000. This is a drastic contrast to June 2018 when 72 homes under $199,000 were sold. For homes listed above $400,000 things start to even out in regard to 2018 sales.

graphic of homes sold in Colorado Springs(single family homes only)

Sellers:

We are now half way through the moving season and if you have an active listing that has been on the market for a few days it’s time to review this market, pricing and showing feedback to see what it takes to snag a buyer before buyers fall into the “back-to-school real estate lull” after mid August.

Buyers:

Since there are many price reductions in the market, make sure you have your ducks in a row -meaning your loan docs- to be able to jump immediately onto a price reduction of a home that you really love. React quickly and decisively and you’ll be in a home before school starts.

Is a Real Estate Bubble in the Near Future for Colorado Springs?

Experts are torn. It’s been 8 years since we hit the bottom of the housing crisis back in 2011. Housing prices since then have increased steadily every year. Many are wondering if we are heading into another housing bubble. Some experts believe that Colorado Springs will be particularly impacted should a bubble happen. It’s hard to predict the next bubble because there are also many micro markets in our nation with their own micro real estate market climates.

The concerning factor is that the median household income in Colorado Springs has been increasing very little and has not kept up with home values. In 2017, the median household income in Colorado Springs was $65,593. This is shocking to hear because it’s actually about $2,000 less than it was in 2008. The median household income trends indicate whether residents can keep up with the increase in home prices and the cost of living. The bad news is that a median household income that does not keep pace with home prices decreases affordability. It also makes people more vulnerable to economic fluctuations because of the narrower margin of expendable income.

Related Reading: Is the Cost of Living in Colorado Springs High?

How can home buyers still afford these high prices? Many home owners are able to sell their current home with a nice return on their investment. This allows them to make a larger down payment on their next home even if that home is more expensive. A new, more expensive home can be possible, especially if that return from a home sale is combined with savings and buying during a dip in interest rates.

Related Reading: How much is my home Worth?

Another reason home values remain strong might be the large influx of new residents. Many folks new to Colorado Springs are moving from more expensive areas in the nation. This often means they are able to easily afford our prices and win bidding wars with a cash payment. Renters and first-time buyers who want to purchase the American Dream often get left behind unless they are willing to look further south or east in Colorado. Pueblo has become popular and it is a great option for home buyers who want to escape the expensive Colorado Springs market.

{Based on information from the Pikes Peak REALTOR® Services Corp. (“RSC”), for the period June 1, 2019 through June 30, 2019. RSC does not guarantee or is in any way responsible for its accuracy. Data maintained by RSC may not reflect all real estate activity in the market}

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