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One of the most common questions I get from people thinking of selling their home is are we in a Real Estate bubble and do we expect the market values to go down soon? The answer is no! If you need to sell your home, now is a great time to sell. Even the industry experts at CoreLogic believe that the Colorado Springs real estate market is going to continue to rise for the next 5 years. CoreLogic is the data and internet service company who owns most of the multiple listing services (database of homes that sell) in the country. In fact, according to Dr. Frank Nothaft, Chief Economist for CoreLogic, “Sales of new and existing homes this July were up from a year ago, supported by low mortgage rates and rising family income. With the for-sale inventory remaining low in many markets, the pick-up in buying has nudged price growth up. If the low interest rates and rising income continue, then we expect home-price growth will strengthen over the coming year.”
And that same economist predicts the Colorado Springs area real estate market will increase by 5.8% over the next year from August 2019 to August 2020.
According to industry experts, while the annual rate of appreciation has slowed from the past 4 years, the moderate home price growth should be welcome news to entry level buyers. In the past 3 years, older Millennials, ages 30-38, have purchased a home. Additionally, current interest rates sitting at 6-year lows. The predications are that rates will stay low through the winter. Right now, is one of the best times for invest in real estate. Low interest rates mean buyers can afford more expensive homes and purchase larger homes than they would have with higher interest rates.
The # 1 reason why we’re not in a housing bubble is new homes are still being built at a high volume in this area. They are building a lot of homes. They’ve even purchased the land on Springs Ranch golf course to build more homes in the Colorado Springs area!
The # 2 reason why we’re not in a real estate housing bubble is President Donald Trump made it official with the establishment of US Space Command to be temporarily headquartered at Peterson Air Force Base in Colorado Springs. This move bodes well for Colorado Springs being selected as the permanent home of US Space Command. When that happens, it could mean another 1250 new jobs entering this market area.
The # 3 reason why we’re not in a housing bubble, there are hedge fund investors purchasing homes this market for full price with cash and keeping them as rental property for their investment pool instead of investing in the stock market. If a huge national hedge fund that invests in just 50 real estate markets in the United States, has picked Colorado Springs as a location in which they would like to own ‘buy and hold’ real estate as an investment, clearly that indicates this market will remain strong for years.
The # 4 reason we’re not in a housing bubble. The mortgage meltdown that we experienced in early 2000 will never happen again.
At that time there were very low & easy criteria for buyers to quality for a mortgage. Buyers didn’t have to prove that they qualify to make the house payments. All they had to do was fog a mirror and claim they could pay. Now lenders must, buy law, prove that mortgage borrowers can afford to make the house payments which they are applying for.
The # 5 reason we are not in a housing bubble is the Colorado Springs area has been ranked the number 3 city to live in the US according to US News & World Report The entire area is very beautiful! The Colorado Springs area is less expensive to live in as compared to Denver. The Colorado Springs area has lower property taxes than most Denver counties. There are so many amazing outdoor things to do here, and the weather’s great, with over 300 sunny days per year. Although some other areas in the country are experiences values trending down, real estate trends have always been mostly based on local area income, employment, taxes and area attraction factors.
Barb Schlinker, is the Broker/Owner of Parker St Claire Realty in Colorado Springs. Barb Schlinker can be reached for questions at 719-319-1802.