The Colorado Springs-area housing market remains strong, even if there are signs of a slowdown that could affect buyers and sellers, some real estate agents say.
“It’s slowing, not to be confused with shrinking,” said Eddie Hurt of ERA Shields Real Estate in Colorado Springs.
According to a Pikes Peak Association of Realtors report for January:
• Home sales totaled 902 last month, a 3.8 percent decline from January 2018. Year-over-year home sales now have fallen for 11 consecutive months. Nevertheless, last month’s sales were the third highest for any January, which is typically a slower month. The sales figures are for single-family and patio homes and exclude townhomes and condominiums, and most sales took place in El Paso County.
• Home sales that closed in January spent an average of 46 days on the market before selling, one week longer than during the same month last year.
• Prices continue to rise, but the rate at which they’re increasing has slowed. Of homes sold in January, the median price — or mid-point of all sale prices — rose by 2.9 percent to $303,450 on a year-over-year basis. January’s percentage gain in prices was the smallest in three years.
• The supply of homes for sale has increased, yet remains historically low. A total of 1,616 homes were listed in January, up nearly 31 percent over the same month last year. The homes for sale in January represented a 1.8-month supply, based on the pace of recent sales; that’s up from a 1.3-month supply a year earlier. While last month’s inventory was higher on a year-over-year basis, January listings usually top the 2,000 and 3,000 mark in non-recession years, association records show.
The decline in sales became particularly noticeable during the fourth quarter of 2018, Hurt said.
That’s when long-term mortgage rates came close to hitting 5 percent, which might have caused some of today’s buyers to delay purchases — even though baby boomers remember a time when rates were in double digits, he said.
In his housing market newsletter, Harry Salzman of ERA Shields and Salzman Real Estate Services said the historically tight supply of homes for sale gives buyers fewer choices, especially at lower price ranges. In January, sales of homes priced at $300,000 and under totaled 433; three years earlier, the total was 620.
“This is affecting everyone, particularly those looking for starter homes,” he said of the tight supply.
The slowdown in price appreciation, however, could be a plus for the market, Salzman said. It gives buyers who’ve been on the sidelines the impetus to begin searching for a home, he said.
Despite the slowdown in price appreciation and sales, Hurt said the housing market is well positioned for a good year. The Colorado Springs-area economy is healthy, unemployment remains relatively low and several new commercial projects are underway, especially in downtown where the U.S. Olympic Museum, apartments and hotels are under construction.
“I just don’t foresee anything in the next 12 months that would derail our real estate market,” Hurt said.