Sales of single family homes in the Pikes Peak Region — the state’s second-largest real estate market — dipped by 20 percent last month compared to July 2022.
The number of days a home stayed on the market in July — 27 — was also almost double what it was a year ago —14 days.
“There's still high demand and low inventory,” said Randy Case, President of the Pikes Peak Association of Realtors. That has been the case for years in Colorado Springs and gave a lot of advantage to people selling their homes at a tidy profit. This, the continued sting of high interest rates from the Federal Reserve, and the higher mortgage interest rates buyers are paying as a result, has dampened that long-term trend.
The pinch is being keenly felt in the market for mid-tier homes, with buyers interested in upgrading from their first property often staying put instead.
“A lot of folks are finding ways, we've seen, to stay in their current homes because of their great interest rates,” Case said. “Unless they physically have to [find a new home] for their family size changing or something … that interest rate switch is going to cost people. The same $2,000 mortgage a year ago is now running about $2,700 a month, some statistics would indicate.”
Many of those potential buyers, he said, are opting instead to remodel or add on to the homes they already own.
The additional pressures for buyers drove down the median price for a single family home in the region in July, a rarity for the busy summer season. That median price now sits at $472,000, down from $485,000 in June.
The situation has led communities like the city of Colorado Springs to more aggressively pursue state and federal assistance programs that can help potential home buyers with things like down payment assistance and interest rate buy-down plans. Case said those options haven’t been fully implemented yet in the region.
Meanwhile, homes in Colorado Springs continue to be more affordable than in Metro Denver. That same median single family home price in Denver is currently $650,000. A household would need to earn more than $160 thousand a year to afford that.
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