Colorado Springs-area homebuyers continue to dig deeper into their pocketbooks, as a historically low supply of properties listed for sale and strong demand send prices soaring.
The median price — or midpoint — of Colorado Springs-area homes that sold in July climbed to $332,000, a 7.1% year-over-year increase and the fourth consecutive month that prices have hit a record high, according to a Pikes Peak Association of Realtors report.
Home prices have risen each month since December 2014; double-digit percentage jumps were the norm for much of 2018, though single-digit increases have taken hold this year.
Higher prices are good for home sellers, who can command top dollar after years of investing in their properties.
But the market can be tough for buyers — especially those seeking lower priced and entry-level homes. Some real estate agents have said the local supply of homes for sale under $300,000 is dwindling.
As a result, sellers in lower-price ranges sometimes field multiple offers and bids that exceed their asking price. Buyers, meanwhile, often find themselves competing for homes. Those who can’t find the house they want must settle for a smaller home, continue to live in an apartment or even consider buying in Pueblo.
“It’s just the basic economics of supply and demand right now,” said Eddie Hurt, a real estate agent with ERA Shields Real Estate in Colorado Springs.
“And unfortunately, it (home prices) just keeps going and going. At some point, it’s going to continue to out-price a lot of people where they can’t afford to buy.”
The latest Realtors Association’s report also shows:
• The inventory of homes for sale in July totaled 2,199, a 7.8% drop from the same month last year. Last month’s listings were the fewest for any July over the last 25 years, based on records maintained by The Gazette.
• Based on the pace of home sales and the number of listings, there was just a 1.3-month supply of homes available in July.
• Single-family home sales totaled 1,662 in July, up 4.4 percent from the same month last year. Through the first seven months of this year, sales totaled 9,245, down 0.5% from the same period in 2018.
• Homes spent an average of 23 days on the market before selling; a year ago, they sold in an average of 22 days.
Hurt said he doesn’t see much change in the market in the coming months. Demand will remain strong, driven in large part by a healthy local economy and low mortgage rates.
The area’s unemployment rate in June fell to a 14-month low at 3.5%; 30-year, fixed-rate mortgages, meanwhile, averaged 3.75% last week, down from 4.6% a year ago.
“I don’t see anything that’s going to change,” Hurt said.
“Demand continues to stay (strong), interest rates continue to be low, the economy is still doing good. And the fourth thing is, a lot of people are seeing that the Front Range is a great place to live. Colorado Springs, the last 20 years, we’re seeing a lot of out-of-towners move to town.”