Colorado Springs MLS Market Update for September 2021
By Murray & Associates – Keller Williams Colorado Springs
Inventory increased 17% over August with median and average sales prices dropping slightly.
For Colorado Springs and surrounding areas theAverage Sales Price for September was $498,003, Median Sales Price was $440,000 and months of Inventory was 0.7 months.
From One Year Ago: There are 19% more homes on the market (active listings) and the number of homes sold was down 2.5%. Average sales price is up 13.4% and median sales price is up 12.5%. Months of inventory is up from 0.6 months to 0.7 months. New home starts are down 31.5%
From One Month Ago: Active listings are up 17%. Average sales price is down slightly and median sales price is down 2%. Months of inventory increased fron 0.5 months to 0.7 months. The number of new home starts is up 218%.
Summer slow down continues into September as we saw homes sit on the market a little longer, and fewer showings than the previous summer months. We are still seeing competing offers and sales price above list price thought there are often fewer showings. 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 a lack of cash for the appraisal gap.
Homes continue to appreciate in the double digits over one year ago, though have slowed down when looking at month-to-month appreciation over the last few months. Other indicators are not showing a turn down in the market, but if interest rates start to increase, this may happen quickly. Such indicators include months of inventory, days on market, and seller-paid concessions.
Sellers continue to be 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 continue to be difficult to get accepted.
New home permits are down 31.5% from one year ago and up 18% from August. The shortage of labor and materials are putting a squeeze on new home starts. Builders are reluctant to contract to build when they can’t guarantee they can get the materials and stay on schedule. Buyers are reluctant to build when the final price of their home is not determined until late in the building process because of the increasing price of materials.
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 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