Photo by Bryan Grossman
Photo by Bryan Grossman

The Tri-Lakes region — Monument, Palmer Lake and Woodmoor — is seeing unprecedented growth as commercial development along Interstate 25 has given way to homebuilding aimed at meeting the demand of a growing population.

Over the past decade, Monument has led the region’s development with its growing retail and restaurant options, as well as the creation of several large subdivisions with homes in a variety of price ranges.

And now, real estate experts say the Tri-Lakes housing market in northern El Paso County is perhaps the hottest it has ever been — breaking records in home price, the number of sales and average list time.

“The market in Monument has been hot — more so than Colorado Springs — for about two to three years, and it’s gotten even hotter this year,” said Realtor Jean Wheaton (The Wheaton Team – RE/MAX Properties). “We’ve had lots of development … but Monument has really grown in a nice way.”

Much of Monument’s residential growth has occurred in new communities such as Sanctuary Pointe, Forest View Estates and Lake of the Rockies, where area homebuilders are capitalizing on an increasingly common problem: a lack of inventory.

The number of active listings in the Tri-Lakes MLS (multiple listing service) dropped to just 111 last month — the lowest in recent history — as the number of potential homebuyers has skyrocketed.

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“There aren’t a lot of homes in Monument and there are even fewer in Palmer Lake,” said Realtor Amanda Miller Luciano. “I think you’ve got a shortage of supply and a lot of demand.”

Much of that demand comes from potential homebuyers who have been priced out of the Denver market and have begun looking at Monument and the surrounding communities as their next-best bet.

“I think you’ve got a lot of people buying homes in Monument and commuting to Denver,” she said. “It still has that really great remote feel, and it’s becoming a more realistic place to live because you can have that country, custom, mountain feel without having to drive half an hour to the grocery store.”

The rise in homebuying in Tri-Lakes hasn’t been without consequence: Because of the lack of available product and elevated interest from higher-income families, the median home price increased from $415,000 in February 2016 to $485,000 in February 2017. That’s compared to a median home price of $268,000 in Colorado Springs.

“While $300,000 can go a long way in Colorado Springs, it’s pretty much the beginning in Monument,” Luciano said. “But $500,000 doesn’t even buy you much in Denver right now.”

And Wheaton said sales can reach much higher prices than that.

“We just closed one that was $1.145 million and we’ll be closing another one in the next month at $1.25 million,” she said. “There’s another one that just went under contract for $1.3 million.”

As prices continued to rise, homebuilders saw an opportunity to offer newly constructed tract homes for comparable prices.

One such homebuilder is Mike Fenton, vice president of Colorado Springs-based Century Communities.

“In that ZIP code — two or three years ago — there weren’t many lots that were developed and ready for homebuilding,” Fenton said. “There was so much pent-up demand, which is why I think we’ve seen this spike.”

According to Pikes Peak Regional Building Department records, there were 43 building permits issued in March for single-family home construction in Monument — averaging 3,449 square feet and $436,142 — compared to 23 in March 2016. The only two ZIP codes in El Paso County to exceed that number of permits for new single-family home construction were 80925 (Southeast Colorado Springs) with 49 and 80908 (Black Forest) with 47.

On average, new tract homes in Monument range from $300,000 to $650,000. And although that may seem steep to some looking to relocate within El Paso County, market experts say it’s quite a bargain for others.

“What we’re finding out is there is nothing under $300,000 anymore,” Fenton said. “New homes are still a little more expensive, but in the Monument area there is hardly any product in the market. … If they want to live there, they have to buy new.”

He said that the company has sold 51 homes in its 156-lot Lake of the Rockies subdivision — situated between downtown Monument and Monument Lake — since its development began in August 2015.

“It was a slow start in 2015,” Fenton said. “We didn’t really take off selling until about a year ago.”

Since then, he said they can hardly build fast enough to meet demand for Century’s homes, which range from $325,000 to $450,000.

“That’s nothing to these people who are coming from the Denver area,” he said. “They’re thinking of their commute … and between Castle Rock and Monument, there’s nothing but million-dollar homes in Larkspur.”

Fenton said that around 75 percent of his homebuyers come from the Denver metro area, while the remainder typically come from Colorado Springs or are families looking to relocate within the Tri-Lakes region.

Although the single-family market is hot in Monument right now, Fenton said there is a growing need for new multi-family development. Because, while the local real estate game is proving a boon for industry professionals and local sellers, it’s leaving many lower-wage earners in the lurch.

“Entry level is not there anymore,” Fenton said. “You’ve got to have places for firefighters, the police officers and the schoolteachers who don’t make six figures.”