Last year was another record setter for housing in the Colorado Springs area, and there are no signs of a market downturn in 2018.
Single-family home sales totaled 16,337 in 2017, the third consecutive year that sales hit a record high, according to the latest report by the Pikes Peak Association of Realtors.
The 2017 record came despite a 2.4 percent, year-over-year drop in December home sales to 1,206, the association's report showed. December's decline was a rarity; it was only the second time in just over three years that monthly sales fell on a year-over-year basis.
Other highlights of the latest Realtors Association report show:
- Homes continued to sell briskly in December, spending an average of 33 days on the market before selling. That's down from 40 days a year earlier.
- The inventory of homes for sale remained historically low in December, a month when selling activity traditionally slows and a time when some potential sellers are keeping their homes for fear they won't find another to buy. Just 1,350 homes were listed for sale in December, down 12.1 percent on a year-over-year basis. By comparison, nearly twice as many homes were listed for sale in December 2014.
- With a strong demand and limited supply, the median price - or midpoint - of homes that sold in December rose to $285,000, a nearly 12 percent, year-over-year increase. Median prices have risen each month since November 2014.
- The greatest demand for homes continues to be in lower price ranges; in December, about seven out of every 10 homes that were sold went for less than $400,000.
Low mortgage rates, an improved economy and more people moving to Colorado Springs - including Denver-area residents seeking cheaper home prices - have been among reasons cited by local real estate experts for the strong demand for housing.
Last year's housing market continued to favor sellers, said Debbie Howes, a broker with Re/Max Performance and the Realtors Association's board chairwoman. Homes typically went under contract in 10 days, and sold in 30 to 45 days, she said.
Howes recalls a transaction she handled in early summer: a three-bedroom, two bathroom home in the Springs Ranch area on Colorado Springs' east side was listed for sale at $229,000. Six days later, her seller had received 11 offers and the home was under contract for $12,000 over the asking price, Howes said.
"Especially in that more affordable price range, under $400,000, under $350,000 to $400,000, those were the ones that just kind of flew off," she said.
For 2018, Howes said, she expects sales and prices to rise again. More people and more jobs will continue to drive the demand for housing, she said.
One problem for the market, however: entry-level buyers will have slim pickings because of the strong demand and rising prices, Howes said.
Some of those entry-level homes are being scooped up by institutional investors, who buy homes for the purpose of leasing them, she said. Investors have cash in hand to make their purchases, putting them in a better position to buy and leaving first-time purchasers with fewer choices.
"They have cash," Howes said of investors, "and when we're working for our sellers, we have to get them the best deal. But it makes it difficult for the first-time homebuyers."
The Realtors Association's monthly report compiles sales transactions handled by its members, and excludes properties sold by individual owners. Most sales each month take place in Colorado Springs and El Paso County, with a handful taking place in other Front Range counties.