Colorado Springs MLS Market Update for May 2020
By Murray & Associates – Keller Williams Colorado Springs
COVID-19 continues to wreck havoc on the real estate market across the nation, though still not significantly impacting Colorado Springs.
Compared to one year ago, active listings are down over 19% and sales are down 38%. Average sales price is up 5.4% and median sales price is up 5.9%. Months of inventory is up from 1.2 months to 1.4 months. New home starts are down nearly 25%.
From one month ago, Active listings are down 2.8% and sales are down 7.7%. Average sales price is the same and median sales price is down 3%. Months of inventory is up from 1.3 months to 1.4 months. The number of new home starts dropped 6.6%.
For the majority of April, the hands of real estate agents were tied. We were not allowed to show homes to prospective buyers until April 27th. For this reason, many buyers made offers without seeing the home until they were under contract, this is why we saw a drop in sales but not significantly. As the restrictions were lifted in May, more homes went on the market and more buyers pursued home ownership. This is why we haven’t seen a crash and I don’t expect we will. Any home owner that lost their job and are forced to sell, most likely have equity in their homes if they have owned it for more than two years. Because of this, we won’t see a big distressed market.
Recent experience is that we remain in a very competitive market for lower priced homes with multiple offers, cash buyers, and offers that waive 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 are the ones most impacted, having a difficult time getting their offer accepted. We are also still seeing many home return to the market after going under contract. There are many reasons for this, but when it happens within the first week it is often due to buyer’s remorse, or buyer financing issues.
New home permits are down 6.6% from April and 24% from one year ago. New construction is suffering due to COVID-19, though might bounce back quickly.
The gap grows between actives and sales, but is expected to tighten as buyers return to the market after COVID.
Rentals vs. Single Family Homes for Sale helps us keep a finger on the market. Active single family homes have leveled off while rentals have declined.
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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