Posted: Jul 25, 2011 6:05 PM by Andy Koen
Updated: Jul 25, 2011 8:23 PM
It's a great time to buy a house in the Colorado Springs area, but not such a great time to sell one. Economist Fred Crowley says low prices and low interest rates are creating a unique buying environment.
"Prices for existing homes have dropped quite a bit, in some neighborhoods, it's not any given house, but on average somewhere on the $10,000-15,000 range."
In fact, in his latest quarterly report for the Southern Colorado Economic Forum, Crowley points out that even without a federal tax credit, buyers this summer will save more money in the long run than they would have last year.
"Assuming you stay in the house for 30 years, what you're going to save is a down payment, lower monthly payments, ultimate prices of the house, its adds up to close to $50,000 over the lifetime of the home"
He says the tax credit last summer artificially put more buyers in the market which drove up demand and prices. This summer those buyers are gone and prices have dropped which is bad news if you're trying to sell your home.
Realtor Jay Gupta says sellers need to be realistic about how much money they can ask for in this market.
"Unfortunately, this is the sad part of this equation, they have paid too much in the high times and right now the buyer is saying, that is not my problem," Gupta said.
One positive sign in the local real estate market is that foreclosure filings are still dropping. However, most banks have tightened lending requirements which is keeping is more buyers from entering the market.
"Bottom line, right now, buyers have a great opportunity," Gupta said. "Sellers have to be again very motivated and realistic to put the prices on their properties."
Crowley's data also suggest that both supply and demand in the local housing market seem to have stabilized. Historically, that means prices will begin to increase over the next few years.