Residents of Colorado Springs likely already know that real estate prices have been on the rise for several months now. After seeing a slow down at the very beginning of the year, February saw a spike that has continued as the city approaches the midyear. Real estate in the general state has long been coveted, given its natural beauty, clean air, and dramatic mountain views. But some cities, like Colorado Springs, are simply thriving more than others. Learn more about what's driving the price tags and what it may signify for the rest of 2019.
The median price for a typical single-family home in the counties of El Paso and Teller was $328,000 in April, making it the highest median price of any year. The number represents a 7.5% jump from April 2018, and is more than $3,000 more than the June peak price posted last year. This trend was mirrored in the average sale price of all properties, which has also gone up 6.6% from the highest price of 2019 (also set last June). If sales continue this way, we may see this summer be the best yet for sellers in the area. And while it's true that median prices are often pulled in one direction or another by outlier sales, it also seems clear that the market is on an upswing.
Inventory and Demand
Part of understanding the dynamic of home sales lies in how many buyers there are compared to the number of available properties. From January to April, figures show an overall .7% decrease in the number of sales. However, despite the very small decrease in the first four months, the month of April had 1,320 total sales, or a 2.6% increase compared to April 2018. The inventory of available houses on the market is low compared to the decades that came before it, which partially explains why home prices continue to rise. A thriving job market is also contributing to the home seller's good fortunes. When there are fewer and fewer homes available for less than $400,000, it's not enough to meet the demand of the many homebuyers in the Colorado Spring area.
Alternative Housing News
Colorado Springs is not the only city in the state experiencing a climb in median home prices. The bidding wars inspired by the low levels of inventory may explain why tiny home manufacturers are seeing requests for larger homes. While one company used to make 9' x 10' homes, the business owners are now using a custom trailer to manufacture homes that are 30' long. Real estate agents are reporting ever more competitive clients, leading to frustration from those whose offers are rejected.
Some professionals believe they're seeing signs of a housing bubble, which could theoretically lead to the behavior that triggered the economic collapse of 2008. However, the current strong economy would suggest that this is not likely to happen in the near future. Real estate agents are seeing fewer and fewer FHA loans and less financing overall. The more buyers place strong cash offers, the less likely those buyers are to default.
Knowing the Market
Predicting the real estate market is very much like trying to predict the stock market. However, there are a few general indicators about how the rest of the year will play out:
Buyer base: Experts can tell a lot about the future of the city by the types of people moving in. The more stable a buyer is in terms of their career, family status, and financials, the more likely it is that the upward trend will continue.
News: What does Colorado Springs see on its horizon? The more growth people see in the economy, the more likely it is they'll invest now for future returns.
Signs: When residents see constant expansion in their area, such as luxury shops and restaurants moving next door, the more they see their city as the place to be.
Judging from these factors, it would seem that the housing trends are unlikely to reverse anytime soon in Colorado Springs. However, whether a person chooses to buy or sell in the near future, there are ways to maximize each experience—no matter how dire it may seem for buyers or how sure-fire it seems for sellers. The housing market is not always as straightforward as it may seem.
The trends of any area's real estate market tell a lot about the area itself. Colorado Springs is seeing more hard-working people moving to their area, triggering a housing increase and a general economy boost.
Lauren Schneider, Real Estate Agent and Military Relocation Professional (MRP)
Lauren Schneider has lived in Colorado Springs for nearly 20 years and knows that the military is what keeps this town ticking, which is one of the reasons she's chosen to pursue her dream of helping military families with all of their homebuying needs. Learn more about Lauren or start your home search now.