Colorado Springs-area home prices notched a third straight record high last month, as the demand for housing in the Pikes Peak region shows no signs of slowing while the supply of properties for sale remains historically low.
The median price of single-family homes that were sold in June climbed to $331,000, a nearly 2% increase over the same month last year and surpassing May’s record of $329,250, according to a Pikes Peak Association of Realtors report. The median is the midpoint of prices; in June, half of homes sold went for less than $331,000 and half went for more.
Last month’s record comes as no surprise, since prices were trending higher in April and May and typically rise even more as the summer buying season kicks in, said Rick Van Wieren, a real estate agent with Remax Properties in Colorado Springs.
In fact, don’t be surprised if another record is set in July, he added, although prices usually level off from there.
Other highlights of the Realtors Association’s June report include:
— The average sales price also set a record high of $373,792, up 3.4% on a year-over-year basis. The average, however, is considered less reliable by industry experts since it can swing wildly with a few very high or very low sale prices.
— Sales for the month totaled 1,651, down 5% from June 2018. Through the first half of this year, home sales totaled 7,583, a 1.6% decline from the same period last year.
— Homes sold briskly, spending an average 24 days on the market. That’s slightly higher than the average 21 days from a year ago.
— The inventory of homes for sale in June totaled 2,122, an almost 2% percent year-over-year decline. In pre-Great Recession years, June inventories typically topped 4,000.
— Based on the pace of recent sales, there was only a 1.3-month supply of homes available in June.
“When you break it down again by county and then by city, within the county, we’re in a roughly one-month supply of homes still,” Van Wieren said. “That’s not enough. … Those are just too skinny numbers.”
Because of the lack of available homes, multiple bids that come in above a seller’s asking price remain common in the market, he said.
The tight supply, Van Wieren added, continues to be particularly acute in the $300,000-and-under price range and for entry-level buyers. Monthly sales would be higher if more affordable properties were available.
“It’s holding back the sales,” Van Wieren said. “We don’t have $250,000 homes really anymore.”
Other facets of the housing market are frustrating, too, Van Wieren said.
Buyers and sellers increasingly are dealing with appraisals that come in several thousand dollars lower than their agreed-upon sale price, Van Wieren said. When that happens, the buyer must bring more money to the table or possibly lose the deal.
“It can affect anybody who doesn’t have more cash than the minimum required for a down payment,” he said.
And even with the fierce competition for homes, buyers are starting to demand more of the homes they’re buying, Van Wieren said. If they’re paying higher prices, buyers expect homes to be in better condition.
“They are paying more and they’re paying above asking sometimes, so they’re asking for more things to be fixed,” he said. “That’s causing some deals to crash, because sellers are saying, ‘It’s a seller’s market, I don’t have to,’ and buyers are saying, ‘All right, sell it to somebody else, I’m not buying your house with a bad furnace.'”
Tribune Content Agency