The Colorado Springs housing market continues to recover, according to two reports issued Friday showing housing construction in February doubled from a year earlier while mortgage foreclosures filings last month dropped to the lowest level in more than six years.
Single-family homebuilding permits totaled 220 in February, exactly double the total from February 2011 and the highest total for any February since 2006, according to a report from the Pikes Peak Regional Building Department. The number of permits issued in the first two months of the year is up slightly more from than double from the same period last year to 398. That continues last year’s gains of nearly 60 percent from the previous year to the highest annual total since 2006. Housing construction has increased from the same month a year earlier every month since January 2012.
“This is further evidence of the recovery in the local housing industry and, along with the incredibly low number of foreclosures in February, points to an improving local economy,” said Fred Crowley, senior economist for the Southern Colorado Economic Forum.
The number of permits issued for housing construction is a key barometer of the local economy, employing thousands of people and generating millions of dollars in taxes on the purchase of building materials. That tax revenue helps fund basic services such as public safety, roads and parks.
Crowley credits historically low mortgage rates and pent-up demand on the part of buyers for the recovery. Rates on 30-year, fixed-rate mortgages averaged 3.51 percent in the week ended Thursday, up slightly from the rock-bottom levels of November but well below the average for a year earlier.
Tom Binnings, a partner in Summit Economics LLC, a local economic research and consulting firm, speculated that builders likely were starting homes now to expand their inventory for the spring and summer selling seasons. He also expects a stronger housing market will prompt a growing number of sellers to put their homes on the market in coming months.
Housing construction in the Springs fluctuates on a seasonal basis, increasing sharply in March, rising through August and at its weakest in December and January. The strong start to 2013 is well ahead of a forecast from the economic forum that housing construction would increase 6.5 percent this year.
In another barometer of the housing market, local mortgage foreclosure filings in February were down 38.1 percent from February 2011 to 180, the lowest monthly total since December 2006, according to a report from the El Paso County Public Trustee’s Office. Foreclosure filings — the start of the legal process in Colorado that can lead to the loss of a home or other property — in the first two months of the year are down 30.3 percent from a year ago to 394. Last year, local foreclosure filings fell for the third consecutive year, dropping to a six-year low.
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