The feared ‘double dip’ housing recession may have arrived. August 2010 single family home sales in Colorado Springs dropped for the 2nd month in a row compared to the prior year, by 22.8% at 688 homes. Year to date sales are now even with last year, but assuming the current trend of year to year declines persists through the slower fall and winter selling seasons, 2010 will likely go down as slower year than the anemic 2009.
It wasn’t all bad news. The average price was actually up 10.6%, at $246,072, reflecting some life at the higher end (although the sale of a $2.3 million dollar home may have pulled this up a little). The median (1/2 above, 1/2 below) also rose 4.8% from 2009, although it declined from the prior month. Distressed sales appear to be down. At 120 homes, this was only 17.4% of the market, the lowest in a year. The inventory of 5,835 unsold homes, while up 15.8% over 2009, was down from July’s peak.
Slower sales, while expected initially after the tax credit program expired, were not expected to continue for long, as interest rates at historic lows (locally 4.25% with no points or origination on my most recent quotes). Reasons for slower sales include a depleted buyer pool as a result of ‘borrowing’ purchases earlier in the year with tax credits, job scarcity and uncertainty, and tighter lending rules making even today’s low rates unreachable for some buyers.
For more details, please visit the Market Conditions section of this web site.