February 4, 2014 Updated: February 4, 2014 at 5:32 pm
Colorado Springs-area home sales fell in January for the third consecutive month, although prices continued to climb, according to a report by the Pikes Peak Association of Realtors.
Last month's sales of 596 homes declined nearly 10 percent compared with January 2013, the report showed. That total includes new and existing single-family homes. Existing homes, which typically make up about 90 percent of all transactions, fell 7.4 percent in January from the same month last year.
Bruce Betts, broker-owner of Re/Max Advantage, a Springs residential brokerage, said Tuesday that January's decline continues a trend that started late last year. Even though home sales in 2013 rose to a seven-year high, they slowed in the fourth quarter, he said.
Mortgage rates might have been a factor; many people might have rushed to buy during the first three-quarters of last year as they saw rates starting to rise.
By the fourth quarter of 2013, sales started to slow as long-term mortgage rates rose by roughly a full percentage point from where they had started the year. Last week, 30-year, fixed-rate mortgages averaged 4.32 percent nationally, according to mortgage buyer Freddie Mac.
A report on Monday from Pikes Peak Regional Building Department showed home construction also softening in January compared with the same month a year ago - a drop also blamed, in part, on rising mortgage rates.
The slowdowns might signal the local economy hasn't rebounded quite as well as some people think, Betts said.
"With all this talk about the economy getting better, I just don't think it's really true," he said. "People are still unemployed and underemployed."
Still, Betts said he looks for home sales to increase by about 5 percent in 2014. Sales will continue to be driven by traditional buyers, including first-time buyers, move-ups and investors, he said.
But the market also will be boosted by home and apartment renters who are looking to buy after having seen their rents rise for much of the past few years, Betts said. Some of those renters are homeowners who had lost their properties to foreclosure or short sales two to three years ago, he said.
"They lost their home, and went into a rental property, and now they've gotten through that," Betts said. "They've cleaned up their credit."
The median price of homes that sold in January rose to $212,000, a 3.4 percent increase over the same month a year earlier, the Realtors Association report showed. Year-over-year median prices now have risen for 23 straight months. The median is the mid-point of all sale prices.
The supply of homes listed for sale rose 10.2 percent to 3,228 in January compared with January 2013, according to the Realtors Association.
The monthly inventory of homes for sale had been in the neighborhood of 5,000 to 6,000 from 2007 to 2009, when the local housing market was hard hit by the economic downturn and many homes were languishing on the market.
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