During a recent update by Tatiana Bailey, the UCCS Economic Forum’s executive director, there was good news: Unemployment is at record lows. And there was bad news: Housing prices are still on the rise.
The upward push means Colorado now ranks among the most expensive states in the Western region in terms of housing. Typically, California’s market pushes regional prices above Colorado, but that’s no longer the case. Statewide, housing costs now equal California’s.
That’s in large part due to sky-high prices in Boulder and Denver, where the median house now costs more than $500,000. But median housing cost in the Pikes Peak region increased 10.89 percent in the last quarter of 2017, to $285,800.
The city now ranks as the 28th-most-expensive metropolitan area out of 184 tracked by the National Association of Realtors. Still, compare the median price in the Springs to that of the most expensive city in the nation: San Jose, where the median price is $1.27 million. Boulder is ranked No. 6 on the list, with a median price of $546,400.
And prices are rising fast in the Pikes Peak region: 5.3 percent faster in the Springs than the rest of the nation.
That meteoric rise is causing concern throughout the city. To add insult to injury, many landlords refuse to accept federal housing vouchers that were created to find homes for lower-income residents. At Homeward Pikes Peak, families wait as the organization seeks landlords that want to accept the vouchers. For those families, the wait is often in a shelter, with friends — or on the streets.
Further complicating the picture: Historically lower-than-average wages. Bailey said that in order to meet staffing needs in a time of low unemployment, companies are going to have to start paying workers more. And that, she said, could lead to inflation above 2 percent and trigger the next downturn when the Federal Reserve raises interest rates to keep inflation low.
The Housing & Building Association lists affordable housing as one of its top priorities. The Pikes Peak Association of Realtors is seeking solutions as well, and is advocating at the state level for tax credits for developers who build more affordable housing. Those tax credits make it more enticing to build homes and apartments for the local workforce.
There have been conversations at nearly every level about how to find new ways to address homelessness, find places for the working poor to live, find homes for soldiers and airmen, and address the lower- to middle-class housing crunch.
The Gazette has hosted a forum, as has the HBA. Together for Colorado Springs, a nonprofit started by CSBJ owner John Weiss, is planning a forum this spring and bringing in housing experts from Boston and Detroit to talk about what worked there and lessons learned along the way.
Affordable housing is a business issue — it’s a tool for economic retention and attraction.
And right now, lower home prices in Colorado Springs (relative to Boulder and Denver) are attracting new residents, which attracts new businesses. Those lower prices are also drawing buyers from northern Colorado, who realize they can get more house for their money just over Monument Hill.
But the quick pace of rising home prices is troubling — and there are actions the city, county and other organizations can take to make sure we have the affordable housing the city needs to thrive.