Home construction in the Pikes Peak region remained strong in 2019, and local builders are looking for a repeat performance in 2020.
Permits issued for the construction of single-family homes in Colorado Springs and El Paso County totaled 3,530 last year, an 8.5% drop from 2018’s total of 3,856, according to a report issued last week by the Pikes Peak Regional Building Department.
Despite that year-over-year decline, 2019’s permit total was the second-highest over the last 14 years and signaled a healthy demand for new homes, some builders say.
“I don’t see it slowing down this next year at all,” said Randy Deming, CEO of Campbell Homes in Colorado Springs. “I think we’ve got a very solid market.”
Last year was Campbell Home’s best in its more than 50-year history, Deming said. The company pulled 95 permits for the construction of single-family, detached homes, which is roughly double its annual total over the past few years, he said.
Vantage Homes of Colorado Springs, meanwhile, pulled 178 single-family permits in 2019, which was in the top five for any year since the company started business in 1983, said executive vice president Mike Hess. “For us, it was a very healthy year,” he said.
A surging local economy, strong job growth and attractive mortgage rates helped drive homebuilding in 2019, Deming and Hess said.
The Springs’ unemployment rate was 3.2% in October, while the average for 30-year, fixed-rate mortgages nationwide fell below 4% in late May and stayed there throughout the rest of 2019, according to mortgage buyer Freddie Mac. As of Jan. 2, long-term mortgages averaged 3.72%, Freddie Mac reported.
At the same time, a shortage of homes listed for sale on the resale side of the market in 2019 led many buyers to purchase a new home, Hess said.
Last year’s building permit total might have been even higher if it hadn’t been for a tight supply of developed home sites, which slowed the pace of construction, Hess said.
He and Deming say they don’t see anything that will curtail the new home market in 2020, barring an economic downturn.
“It’s almost like a perfect storm,” Deming said. “I don’t sense anything that’s going to turn negative on us.”
Hess said the opening of In-N-Out Burger this year in Colorado Springs, an expected announcement of a major Amazon distribution center coming to town and Congress’ designation last month of the Springs as the home of the new Space Force armed-service branch all bode well for the community and its housing industry.
The Springs is becoming a much more attractive place for people to call home, he said.
“You’re starting to see a lot more millennials move here, but also move back,” Hess said. “I grew up here (in Colorado Springs). I ended up moving back and a lot of the people I grew up with here are moving back. It’s a great place to raise a family.”
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