The Colorado Springs real estate market consistently ranked among the nation’s hottest metro areas in 2019, and experts say it shows few signs of cooling.
In a December report, the National Association of Realtors identified Colorado Springs as one of 10 markets expected to outperform nationally in the next three to five years. NAR identified the top 10 metro areas based on a myriad of factors, including domestic migration, housing affordability for new residents, consistent job growth relative to the national average, population age structure, attractiveness for retirees and home price appreciation, according to a news release.
Recent movers accounted for 21 percent of the Springs’ total population in 2019, with the Denver-Aurora-Lakewood metropolitan area accounting for more than 10,000 of those newcomers?.
“The nice thing about El Paso County is that I think we’ve seen a lot of people from the Denver metro area come down here because housing prices are still affordable,” said Jacob Curbow, board chairman for the Pikes Peak Association of Realtors. “I knew we were getting a lot down here, but I didn’t realize it was the majority.”
That migration pattern also explained the explosive residential growth in the northern part of the city, Curbow said. Of those 10,000 people, he estimated at least one in each household is likely still commuting to the Denver area.
“That north end growing is also due to some of the people moving down from the Denver metro area because they want to be up north,” Curbow said. “Northeast [Colorado Springs] is the hottest-growing area in town.
“That’s really where most of the construction is,” Curbow added. “There is still a lot around Fountain, but the lion’s share of what we’re seeing is north and east, by Powers and Woodmen toward Flying Horse.”
ADDRESSING AFFORDABLE HOUSING
Despite all the ongoing construction, Curbow still did not see the spike in housing inventory that he expected in 2019, he said.
“I kind of expected inventory to pick up and it didn’t get up the way I thought it would, which I think is part of the reason house prices went up,” Curbow said.
“I think affordable or attainable housing is going to be an issue in any city that’s growing at the pace we’re growing at,” he said. “I think [the solution is] going to have to be a combination of a lot of things.”
Colorado Springs’ average monthly rent of $1,294 is 11 percent above the national average and continuing to climb, as are housing prices, according to Mayor John Suthers’ State of the City presentation in September.
The city is 5,000-6,000 units short for those making $14-$18 an hour, said Steve Posey, the city’s community development and program manager for the Department of Housing and Urban Development.
Jobs at that wage level are clustered in the hospitality and tourism, retail trade and warehouse distribution sectors, and comprise about 45 percent of the civilian workforce, Posey said.
“For folks who are more in the minimum wage levels, we also need a comparable number of units,” he said.
The city is working on a comprehensive affordable housing plan “designed to allow for the construction, preservation and opportunities to purchase at least an average of 1,000 affordable units per year going forward,” Suthers said during his presentation.
He said the city would help nonprofits such as Greccio Housing, Partners in Housing, Rocky Mountain Community Land Trust, Pikes Peak Habitat for Humanity and the Colorado Springs and El Paso County housing authorities develop affordable housing units.
Additionally, YMCA of the Pikes Peak Region announced in December a partnership with Omaha-based developers White Lotus Group to renovate and revitalize the downtown Colorado Springs block where the current YMCA sits.
The project is expected to cost at least $150 million and comprise three phases, with the first and largest being a new 75,000-square-foot YMCA facility and 400,000 square feet of mixed-income multi-family units, YMCA spokeswoman Jenna Press said.