Colorado Springs MLS Market Update for June 2021
By Murray & Associates – Keller Williams Colorado Springs
I seem to repeat myself each month with “Inventory remains at a record low with properties selling very quickly”. Though inventory has increased over the previous month, there still remains significant competition with multiple offers on most listings.
Those that took advantage of forbearance during COVID and now must sell, are finding that they have equity in their homes and still do not need to go into foreclosure.
This month there are 47% fewer homes on the market (active listings) than there were in June 2020, and the number of homes sold was up 8%. Average sales price is up 20% and median sales price is up 20%. Months of inventory is down from 0.9 months to 0.4 months. New home starts are up 16%.
From one month ago, Active listings are up 33.5%. Average sales price is up 2.78% and median sales price is up 4.14%. Months of inventory remains 0.4 months. The number of new home starts is up 36%.
We remain in a very competitive market across all prices. Lower-priced homes are receiving multiple offers and higher-priced homes, in desirable areas, are selling quickly, some with multiple offers. When there are multiple offers buyers are waiving contingencies such as the appraisal condition, meaning the buyer is willing to cover the difference in cash between the appraised price and the contract price. First-time homebuyers and VA buyers are the ones most impacted, having a difficult time getting their offer accepted due to lack of cash for the appraisal gap.
There is no indication that this market will slow down anytime soon. Sellers are reluctant to list their homes for fear of not finding another home if they are staying in the area, though we now have a program to solve this problem – Buy Before you Sell. Sellers that want to sell then buy are advised to plan for a way to prevent making a contingent offer or plan to move twice. Some buyers are allowing the sellers to rent back while they complete the purchase of another home. In this market, contingent offers are difficult to get accepted.
Buyers from out of the area are moving into Colorado Springs and are seeing great value and often have cash. Due to the low inventory, many buyers are opting to build.
New home permits are up 16% from one year ago and up 36.5% from May. Many buyers turned to building when the re-sale market took off and became very competitive, increasing the demand for building. This compounded by the problems with the supply chain for building materials and labor has resulted in Builders now have waiting lists for buyers to build and fewer building permits issued.
Traditionally, the number of active properties far exceeds the number of sales, this flipped in June 2020. With the increase in competition, buyers turned to building. Now builders are running out of lots and encountering supply chain and labor shortages. This is pushing buyers out of the market completely and most likely into apartments this summer because there is a severe shortage of single-family rentals as well. I don’t anticipate this changing in the near future unless interest rates increase or buyers begin to realize that homes are no longer affordable in Colorado Springs.
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Based on information from the Pikes Peak REALTOR® Services Corp. (“RSC”). RSC does not guarantee or is in any way responsible for its accuracy. Data maintained by RSC may not reflect all real estate activity in the market.
By Nancy Murray
Murray & Associates, Keller Williams Colorado Springs