According to the Colorado Association of Realtors, home prices in Colorado were mostly flat across the state, but some areas still saw double-digit increases, with the Telluride area reporting the largest increases. There is. Pictured here is Tom Cruise's former mansion in Telluride, which sold in 2021 for $39.5 million. (Brett Schreckengost, Liv Sotheby's International Realty)
Colorado homebuyers have been struggling to catch their breath over the last year, having to juggle mortgage rates that will approach 8% by early fall with home prices that remain high even as affordability has declined. did not become.
Home and condo sales fell nearly 20% last year, and sales periods extended by an additional week to an average of 62 days, according to the Colorado Association of Realtors' 2023 tally.
However, rising interest rates did not cause prices to fall significantly or inventory to increase, leaving buyers in a difficult position. Looking at full-year numbers, the median sales price for single-family homes sold in Colorado fell 0.6% from $533,000 in 2022 to $530,000 in 2023. By December, the price had fallen further to $515,500, a 2.7% increase. Comparison with December 2022.
The median sales price for condos and townhomes rose $1,000 in 2023 to $420,000. However, when comparing December 2022 to December 2022, the median price increased by 3% to $424,995. If there's a silver lining, it's that the craziness of the last few years of the pandemic is fading in the rearview mirror. But in the market, most entry-level buyers are stuck on the side of the road with no means to afford a home.
“It's been a healthy down year,” said Cooper Thayer, market spokesperson for the Colorado Association of Realtors and a broker with Thayer Group in Castle Rock. “We were coming off an incredibly hot three years. It was nice to see a slowdown.”
One reason home prices held steady despite rising financing costs was a lack of inventory. Many sellers had mortgage rates below 4%, and there were 21,000 fewer single-family homes and 3,200 fewer condos and townhomes listed last year than in 2022. Unless there is a strong incentive to sell, many current owners will want to maintain the status quo.
The year ended with 14,941 single-family homes on the market (down 14.8% from the previous year) and 3,254 condos and townhomes (down 8.3% from the previous year). Inventories declined at the end of the year in 38 of the state's 64 counties and were flat in four others.
“Basic economic principles of supply and demand have emerged as the primary force preventing prices from falling,” said Marci Valicenti, a Steamboat Springs-area real estate agent, in a comment accompanying the CAR report. Stated. “In 2023, the number of new listings in our market reached its lowest level in 18 years, highlighting the lack of available housing.”
Fort Collins real estate agent Chris Hardy said in comments on the CAR report that rising mortgage rates have proven to be a “death omen” for first-time homebuyers without a minimum down payment. He said the advance market had also been stopped.
“This further exacerbates the low inventory challenge for buyers still in the market, resulting in median prices remaining elevated,” Hardy said.
But things could have been much worse. Colorado's unemployment rate remains low, job creation is sustained nationally, inflation has cooled significantly, consumer spending remains strong, the economy is able to defy many recession predictions, and mortgage rates are falling. If this happens, the ground may be in place for a “recovery'' of the housing market. predicts Hardy.
“Interest rates are lower and there is a new outlook on the market. Buyers are adjusting to the new normal and sellers are learning that they can still win in this market with less competition.” Boulder/Bloom Field Area Realtor Kelly Moye said in a statement.
If interest rates are likely to continue to fall, she predicts buyer activity will increase, prices will rise, and listings will take less time to sell.
Tough for buyers almost everywhere
CAR numbers are statewide, and events in the Denver metro area, which accounts for about 44% of single-family home sales and 70% of condo and townhome sales, have a significant impact on the statewide numbers. Last year, overall single-family home sales across the state fell by 19.1%, but seven counties saw an increase in home sales.
The counties with the highest sales momentum in 2023 were Baca County, with an 80% increase, followed by Sedgwick County, with a 71.4% increase. But it didn't take long for that to change, as the two counties combined had only 31 sales last year. Yuma County sales increased by 29.4% and Minerals and Conejos by about 22%. There were about 400 single-family home sales between Gunnison and Pitkin counties, which saw increases of 13.9% and 7.6%, respectively.
Meanwhile, nearly 20 counties saw a larger decline in sales than the statewide average, led by Hinsdale County, which saw a 42.3% decline, and Cheyenne County, which saw a 40% decline. Montezuma, Lake, Rio Grande, Saguache, Kitkaron and Ouray counties all saw sales declines of more than 28%.
Most of the counties with the biggest declines were sparsely populated and had only a few home sales that year, but two of the state's most populous counties stood out with above-average sales declines. Weld County saw a 24.5% decrease; Weld County saw a 23.8% decrease.
Additionally, home prices in these two counties are below the statewide median, making them popular with first-time buyers looking to buy below market rates in the Denver metro area. The median price of single-family homes sold in El Paso County in December was $467,635, and the median price in Weld County was $492,318.
But these buyers are also more sensitive to interest rates, Thayer said. Over the past seven years, home prices in Colorado Springs have increased by an average of 10% a year, but incomes have only increased by 4.5%, creating an affordability gap, he said. Weld County is heavily dependent on oil and gas jobs and was one of the last counties in the state to recover from the job losses suffered in the spring of 2020 during the early days of the pandemic.
“I would like to start by saying that 2023 was an anticlimatic year. Home prices held steady and the stalemate between buyers and sellers continued. In general, the number of sold properties increased month-on-month. As you can see from the decline, buyers opted out in 2023 and sellers didn't move on pricing. 2023 sales pushed up the median price, but overall the 2023 term may stagnate,” Colorado Springs real estate agent Patrick Muldoon said in the CAR report.
Despite above-average sales declines, El Paso and Weld also recorded above-average increases in median single-family home sales prices. In December, prices rose 5.1% and 3.6%, respectively, compared to a 2.7% annual increase statewide.
Ten counties appear to be holding on in 2021, with double-digit increases in single-family home sales prices, but some of that increase is due to lower-end buyers being squeezed out of the market, especially in mountainous areas. It seems to reflect.
Leading the group with big price increases is San Miguel County, home to Telluride, where prices for single-family homes rose 179.3% and prices for condos and townhomes jumped 36.9%, based on 38 sales in each category. rose to The median price of homes sold in San Miguel County increased from $1.13 million in 2022 to $3.14 million in 2023, while for condos, the median price jumped from $1.55 million to $2.23 million.
“My view is that in the top 10% of our market, the true high-end luxury segment, there are still buyers who can afford the best, whatever that means. The idea is that their wealth will help them weather potential economic disruptions. The remaining 90% of buyers are willing to trade and are being cautious, primarily in the bottom 75% of market segments where prices are rising weekly. It's down, and that's creating some buying,” Telluride-area real estate agent George Harvey said in a report.
Kiowa County saw a 131.4% median sales price increase, and Baca County saw a 39.6% increase, with five and nine sales prices, respectively. However, in Garfield County, the median price of single-family homes sold in December rose 32% for the year, while the median price increase for the year as a whole was 2.3%.
Gunnison, Saguash, Montrose, Eagle, Teller and Alamosa all saw single-family home price increases ranging from 10% to 20%. Looking at median prices for 2022 and 2023, Eagle County stands out, with single-family homes up 20.1% to $1.82 million and condos up 39.1% to $1.4 million. Comparing December to December, condo prices in the county more than doubled to $2.31 million.
The biggest price declines were concentrated in rural counties with low sales volume and below-average home prices. Otero, Dolores, Yuma, Hinsdale, Rio Grande, Las Animas and Rio Blanco counties recorded double-digit declines ranging from 17.6% to 10.6%. With the exception of Hinsdale County, where Lake City is located, all of these declining counties had a median home price of less than $300,000 last year.
Pitkin County continued to hold the title of most expensive home sales in the state, with median sales prices of $6.7 million for single-family homes and $167,000 for condos. This difference can be explained by the large subsidies provided to worker housing, which is mostly apartment buildings. This low price points to how dominant deed-restricted condominiums have become in that market, given the lack of affordable market-rate options for wage earners.
Pitkin was followed by San Miguel with $3.14 million. Eagle for $2.13 million. The grand price is $900,279. and the Gunnison, priced at $897,000, both emphasizing the townscape of an upscale ski resort. Ouray, Root, La Plata and Summit were also at the top in terms of price.
The Front Range counties with the highest median sales price for single-family homes last year were Boulder at $775,000, followed by Clear Creek at $720,000 and Douglas at $705,495.
Counties with the most affordable housing prices were concentrated in the Eastern Plains. According to CAR, the median home sale price in Sedgwick, Otero, Bent, Crowley, Kiowa, Cheyenne, Baca, Phillips, Prowse, Kit Carson, Costilla, and Yuma is under $250,000, while the median price in Sedgwick is $13. It was $2,000.
On average, it took more than four months for a property to sell in Dolores, San Miguel, Baca, Gunnison, Ouray, Crowley, San Juan, Conejos and Huerfano counties. It took him less than a month to sell residential properties in Bloomfield, Arapahoe, Denver, Jefferson and Jackson counties.
