HARRY'S BI-WEEKLY UPDATE 6.5.20
June 5, 2020
HARRY’S BI-WEEKLY UPDATE
A Current Look at the Colorado Springs Residential real estate Market
As part of my Personal Service, it is my desire to share current real estate issues that will help to make you a more successful and profitable buyer or seller.
.jpg)
AS THINGS RETURN TO A “NEW NORMAL” …IT’S FULL STEAM AHEAD FOR HOUSING
With the country is opening up in stages, the Colorado Springs area is doing the same. When it comes to residential real estate, we are as busy as ever while also taking precautions to keep our clients and ourselves healthy and safe. Masks, hand sanitizers and more are all part of our everyday routine now and more than likely will be for the foreseeable future. I’m finding that folks are more than ready to resume buying and selling homes are keeping them safe while doing so is all part of my job.
As I mentioned in the last eNewsletter, real estate is not going to be affected during this sudden economic downtown as it was in the mid 2000’s with the mortgage loan crisis of that time. Today the mortgage market is healthy, and homes are not only retaining their value, but appreciating monthly in our neck of the woods. The biggest hurdle is continuing to be the lack of available homes for sale. That wasn’t helped during the shutdown because we obviously we were not able to list homes at that time and those wanting to sell and trade up have had to wait.
I’ve been busy helping clients prepare their present homes in order to get them on the market as quickly as possible so they can begin the search for new properties in earnest. We lost several months of the traditional spring buying and selling season and we need to make up for lost time—especially for those who need to move prior to the start of a new school year or new employment.
Being quarantined at home for several months presented people with a greater appreciation of what they have now or might want in looking for a new home. Greater room for privacy, home offices, bigger kitchens and yards and other requirements are what I hear from clients when they are seeking a new home. Oftentimes we don’t have the downtime to really see what we might want or need in a quarantined type of situation. I believe these new wants and needs will help drive folks in home buying both now and in the future. After all, our homes are meant to be our “safe haven” and why not make them as comfortable and functional as we possibly can?
And that’s where I come in. With more than 47 years in the local residential real estate arena, I’ve seen many cycles and know how to navigate through them successfully. On a personal level I’ve also seen what I know to be essential in making a house a home and can translate that to help my clients.
If you have been wanting to begin the process of making your residential dreams come true, now is a great time to get it going. All it takes is a phone call to me at 593.1000 or an email to Harry@HarrySalzman.com and I can put my extensive knowledge, experience and special brand of customer service to work for you, your family members and co-workers.
I look forward to talking with you and seeing you soon.
And now for statistics…
You will see that, while home sales prices did not increase as much as in the recent past, they still managed to do quite well for a time when it was almost impossible to visit available homes. With the number of folks ready to buy, I would expect to see these numbers, along with the number of sales, to increase over the next few months.
As might be expected, there were fewer new listings again last month, but considerably more than in April. Now that we can visit homes to photograph them and talk with owners, you will undoubtedly see many more homes for sale before too long.
MAY 2020
Statistics provided by the Pikes Peak REALTORS Service Corp., or it’s PPMLS
Here are some highlights from the May 2020 PPAR report. Remember that the new format of this report no longer provides monthly statistics for each individual neighborhood. However, if you are interested in what’s happening in your neighborhood, I can provide you with this information through other means.
In El Paso County, the average days on the market for single family/patio homes was 17. For condo/townhomes it was also 17.
The sales price/list price for single family/patio homes was 100.5% and for condo/townhomes was 99.9%.
Please click here to view the detailed 9-page report, including charts. If you have any questions about the report or to find out how it relates to your individual situation, just give me a call.
In comparing May 2020 to May 2019 for All Homes in PPAR:
Single Family/Patio Homes:
· New Listings were 1,947, Down 7.9%
· Number of Sales were 1,132, Down 27.6%
· Average Sales Price was $393,517, Up 5.7%
· Median Sales Price was $350,000, Up 6.3%
· Total Active Listings are 1,546, Down 16.4%
· Months Supply is 1.4, Up 0.6%
Condo/Townhomes:
· New Listings were 253, Down 6.6%
· Number of Sales were 150, Down 21.1%
· Average Sales Price was $256,716, Up 4.2%
· Median Sales Price was $250,700, Up 7.3%
· Total Active Listings are 173, Up 4.8%
· Months Supply is 1.2, Down 0.2%
And a look at more statistics…
MAY 2020 LOCAL MARKET UPDATE AND MONTHLY INDICATORS ILLUSTRATE OUR LOCAL TRENDS IN DETAIL
Colorado Association of REALTORS® , Pikes Peak REALTORS Service Corp, or it’s PPMLS
Providing greater detail than the above report, this contains information on both El Paso and Teller counties for Residential real estate.
It is broken down by geographical areas and you can look to see how your neighborhood is doing in terms of sales, prices, and more.
The “Activity Snapshot” for all residential properties in El Paso and Teller counties shows the Year to Date one-year change:
- Sold Listings for All Properties were Down 27.1%
- Median Sales Price for All Properties was Up 7.0%
- Active Listings on All Properties were Down 28.1%
You can click here to read the 16-page Monthly Indicators or click here to get specific information on the geographical area of your choice from the 18-page Local Market Update. I recommend that you check out your own area or one that you are considering, to get a good idea of the local pulse. As an example, here is a detailed report on the Colorado Springs area:
GET READY FOR A FAST-EVOLVING housing market
National Association of Realtors, 6.1.20
June is “Homeownership Month” and time for all would-be sellers to get their properties ready for the market. New research indicates that despite the ongoing risks of the pandemic, 65% of consumers are ready to attend an open house or take a home tour in person!
According to Lawrence Yun, chief economist of NAR, home sales are bouncing back from their bottom during the COVID-19 pandemic and pent-up housing demand during the state shutdowns is about to be unleashed as the restrictions to daily live are lifted or relaxed.
Looking ahead, the market is ripe for robust activity. Mortgage applications are defying economists’ expectations, rising 54% since April. Mortgage rates for 30-year loans have broken through record lows three times in as many months which makes borrowing costs favorable for prospective buyers who are looking to get off the fence and purchase. With home prices continuing to rise, every day you put off beginning your search can cost you money in terms of monthly payments.
HOME PRICES: IT’S ALL ABOUT SUPPLY AND DEMAND
Keeping Current Matters, 6.2.20
One of the major drivers of higher home prices is the lack of available listings. As we make our way through June and into the second half of the year, we still face an undersupply of homes on the market. This, of course, is going to vary by location and price point, but as I just mentioned, Colorado Springs is most definitely suffering from a lack of available homes for sale in most price ranges.
Historically, a six months’ supply is considered a balanced market. Anything over is a buyer’s market, meaning that prices will depreciate. Anything below 6 months is a seller’s market where prices appreciate. Colorado Springs currently has a 1.4-month supply for single-family/patio homes and a 1.2-month supply for condo/townhomes. As you can see from the chart below, we are considerably below the national average of available homes for sale.
According to Robert Dietz, chief economist for the National Home Builders Association, “As the economy begins a recovery later in 2020, we expect housing to play a leading role. Housing enters this recession underbuilt, not overbuilt. Estimates vary, but based on demographics and current vacancy rates, the U.S. may have a housing deficit of up to one million units”.
Given the undersupply, there is upward pressure on prices, and this is certainly apparent in local housing prices. This is what causes the bidding wars we’ve seen of late. As we enter the summer months and work through the challenges associated with the current health crisis, many are wondering what impact the economic slowdown will have on home prices. Looking at the “big picture”, supply and demand gives us the clearest idea of what’s to come.
A recent MarketWatch article stated, “As buyers return to the market as the country rebounds from the pandemic, a limited inventory of homes for sale could fuel bidding wars and push prices higher.”
Additionally, experts forecasting home prices have updated their projections given the impact of the pandemic. The major institutions expect home prices to appreciate through 2022. The chart below, updated this week, notes these forecasts. As 2020 progresses, we may see these projections revised in a continued upward trend, given the lack of homes on the market which could drive home prices even higher.
Bottom Line:
While many may think that home prices will depreciate due to the economic slowdown from the coronavirus, experts disagree. As we approach the second half of the year, we may actually see home prices rise even higher given the lack of homes for sale.
If you were considering a wait before selling to trade up or to move to a new neighborhood, you might want to rethink that and give me a call sooner than later.
ECONOMISTS FORECAST RECOVERY TO BEGIN IN THE SECOND HALF OF YEAR
Keeping Current Matters, 5.28.20
The question on the minds of many right now has to do with the financial outlook of the country and when it will begin to recover.
While no one knows exactly how a rebound will play out, expert economists across the country are becoming more aligned on when it will begin.
According to the latest Wall Street Journal Economic Forecasting Survey which polls more than 60 economists on a monthly basis, 83% believe a recovery will begin in the second half of 2020 as shown in the chart below:
In addition, five of the major financial institutions are also forecasting positive GDP in the second half of 2020. As of today, four of the five expect a recovery to begin in the third quarter of the year, and all five agree a recovery should start by the fourth quarter:
Bottom Line:
With agreement among these leading experts, it’s time to start planning your own moves when it comes to residential real estate. The historically low interest rates aren’t going to be here forever and if a move is in your future…. there’s no reason for your future to not start now.
UCCS ECONOMIC FORUM UPDATE
UCCS Economic Forum, College of Business, updated 5.28.20
I just received the UCCS Economic Forum’s reports on both the national and local economies and wanted to share it with you, as always. You can click here to see the charts and if you have any questions, please give me a call.
