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Are We Seeing a Repeat of 2008's Bubble?

by Jason Daniels

There are three main reasons why Colorado Springs is experiencing high demand with much lower supply. But this doesn’t mean we are in a bubble.
 
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Right now in Colorado Springs, many people believe that we’re in the same bubble situation as we were in 2008.

As you may know, a real estate bubble occurs when there is an imbalance between supply and demand. But is this really the case?

The truth is that today in 2017 our circumstances are actually much different than they were in 2008.

Currently, demand is far outpacing supply. This is primarily because of three things.

First of all, the Denver real estate market is red hot. So because buyers can get a similarly sized home in a similar neighborhood here in Colorado Springs for $100,000 less, they are buying out much of the inventory in the north end of town.

The next contributing factor is that new home construction has been declining since 2008 and hasn’t kept up with the demand.

Prior to 2008, homes were being built at a rate of a million homes per year, but that number has since been cut in half.

Finally, demand is also high because of the large number of first-time homebuyers who are seeking out job opportunities in our area.

"In 2017 our circumstances are actually much different than they were in 2008."

As long as interest rates remain low, prices will likely to continue to rise in the next 12 to 18 months around 6% to 7%, meaning we are, in fact, not in a bubble.

Therefore, the next couple of years will look good for the market as long as demand stays strong.

If you have any other questions or would like help with any of your real estate needs, feel free to contact us by giving us a call or sending an email. We look forward to hearing from you soon.

Where Is the Market Headed for 2017?

by Jason Daniels

Where is the Colorado Springs real estate market headed in the next 12 to 18 months? We’ve got your market update.

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Where is the real estate market headed in Colorado Springs?

Currently, the market is red hot. Year to date, from 2016 to 2017 the average sales price for the first quarter is up 11.7%. The median sales price is up 10% to $275,000, and the sale of residential units is up 2.2%.

Inventory levels are down 34.9% and the number of listings is down 26.6%. The number of foreclosures is also down 31.9%. 

The average number of days that homes are staying on the market is around 36 days, and interest rates are up to 4.1%. With all of this in mind, the $400,000 or lower price range is a seller’s market. We should see that continue to be a trend for the next 12 to 18 months, so if you’re looking to sell, now is a good time.

"Prices will most likely continue to rise for the next 12 to 18 months, and we’re going to see 6% to 7% appreciation per year."

In the $500,000 price range, we’re experiencing more of a balanced market, and it’s still a buyer’s market in the $1 million price range.

Prices will most likely continue to rise for the next 12 to 18 months, and we’re going to see 6% to 7% appreciation per year. In fact, in the last 12 months we’ve seen homes appreciate at about 1% per month, so we’re most likely going to see appreciation follow the same trend.

If you have any other questions, want to know what your home is worth, or are looking at buying a home, please don’t hesitate to give us a call. We’d love to help you!

Displaying blog entries 1-2 of 2

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Jason Daniels & Associates
Jason Daniels & Associates at RE/MAX Millennium
9362 Grand Cordera Pkwy Suite 100
Colorado Springs CO 80924
(719) 966-1500
(888) 351-1099