In an effort to help my clients understand the real estate market, which is changing constantly, I send them statistics and updates on a weekly basis.  It helps people make decisions that move them toward their goals with real estate.

I decided it would be a good idea to let you, cohomesgateway readers, in on this information as well.  You may not be in the Colorado Springs market, or you may be just browsing the web trying to decide if the time is right to buy or sell, andyou may find this information useful.  I’m happy to elaborate on any points if you want to contact me directly.

So what is going on with Colorado Springs and Pikes Peak Region real estate?  Teller County was hit hard when gas prices rose to $4 a gallon levels.  All of a sudden the drive into Colorado Springs to work while living in the mountains seemed like a huge investment of resources so people working in the Springs have been choosing to buy homes closer to their work.  The mountains have an appeal for many though, so gas prices dropping by 2/3rds will probably help that area once again.  There are always buyers who want the mountain and smaller community life in Woodland Park, Divide, Florissant, and other mountain towns.  After all, it’s closer to the ski resorts!

In Colorado Springs and points east, we have hit a low in sales over the past 4 years.  Less than 500 homes sold in November and again in December, 2008.  This is a time of year when we would expect sales to be closer to 600-700 per month.  This has caused a lot of sellers to abandon the market and sit on the sidelines, thus reducing inventory 15% since June, which is an excellent step towards market recovery.  This is not the time for sellers to “play real estate”.  There are no profits to be had and real estate professionals are not inclined to let sellers test the market with their limited marketing funds in this tough market.  Sellers have to be motivated to sell and understand that means competing with 34% of sales going to foreclosures and short sale properties locally.  Price is the key because the bargain shoppers are those in the real estate market, just as they are in the malls looking for the after Christmas steals.  Weren’t you there?  I was.

The median price for the Pikes Peak MLS has stayed in a 20% range over the past 4 years with the high being $225,000 in mid-2006 and the low $187,000 for November, 2008.  We never had the go-go market of other areas such as Phoenix, Las Vegas, and Florida, but sales happened a lot more quickly from 2004-2006 than they are now.  We have 10 months of inventory without anything new coming on the market, even with a reduction in inventory since June, 2008 of 15%.

Only homeowners who are 100% committed to selling should have their homes on the market now and the more limited inventory will help us move to a seller’s market as the economy improves.  Nothing ever stays the same.  A change will come and buyers who sat on the sidelines fearfully while prices and rates are low will be scrambling to make attractive offers on the most desirable properties to encourage sellers to take their offer over others.  The best homes always sell.  It’s just a matter of what buyers will willingly pay because the biggest fear is to overpay.  Too many people have experienced that in rising markets and are now looking at being part of that 34% of distressed sales.  Or 70-80% distressed sales as is happening in other markets.

So what’s a person to do?  If you are considering buying, but thinking about renting, look at your goals.  How long do you plan to be in the house?  Can you still save money and pay a mortgage?  Remember that the tax breaks of owning a home are a form of savings over renting.  If this is a 2nd home or investment purchase, can you withstand vacancies or managing multiple mortgages if your income changed?  Would owning real estate make you sleep better or worse?  If you think renting is better, have you considered the 6-12 months of rent you would be throwing away to pay someone else’s mortgage?  Have you saved money for a down payment, for home repairs, for an emergency fund?  Have you tried setting aside the difference between your current rent/mortgage payment and the new payment amount for a few months to see if it fits (the side effect is you are saving your down payment!)?  Would you be comfortable and still have money for fun activities or would you be house poor?

I could fill a book with questions to ask yourself, but you get the picture.  Make sure you have goals.  Seek the help of experts.  Then have fun making a purchase or selling and moving to the next town or bigger or newer home that you desire.  There are some great deals out there.  It’s a fun process.  Make the right decisions so you can enjoy it and smile when those new keys are put in your hand.  You’ll know you are taking the right step!