Colorado Springs Housing Analysis Based On School District
Welcome back to our ninth year of the analysis of homes in the three primary Colorado School Districts, Academy School District 20, Colorado Springs District 11, and Falcon District 49. This analysis includes home values based on sold properties for the month of January.
The market statistics found on the Colorado Springs MLS (Multi-Listing Service) website and reported by the media is an average for all single family homes,
The following analysis is based on homes sold in the month of January between 2005 and 2017. Why January? Technically, the analysis could be for any month, but we started the data collection the first year, right after the January housing statistics became available, so it made sense to use January. Yes, a summer month, during peak buying season, would probably be a better choice, but several years ago we noticed sales increased significantly in January 2009 over December 2008, probably due to the availability of funding and distressed properties. A perfect solution to the data collection would be to use all the data for each year. Unfortunately, the previous platform for the Colorado Springs
For listings sold, the trend for each area is more important than the actual numbers, primarily because District 11 covers a significantly larger area. From the chart, we see that in 2017 the number of listings sold continued to increase for all three school districts. D20 was up 17.3%, D11 up 11%, and D49 up 13.5%. Both D11 and D49 had the highest number of sales in January 2017 since 2006.
The market is definitely on the uptrend with this slide. Average sales price improved for all three school districts. D20 improved 10.3%, D11 12.9%, and D49 12.4%. We would really like to see this appreciation rate at about 6-8% year over year. When it climbs too fast, then when there is a market correction, it can trend downward at a faster rate, just like we saw in 2008 and 2009.
This year we saw an increase in the median sales price for all three school districts, with D49 having the most drastic change. Academy District 20 had a 10.8% increase, D49 a 32.2% increase, and D11 9.1% increase. This means that for D49,
All three districts saw a healthy increase in price/total square foot in 2017. D20 had an increase to $122/sq ft, an increase of 5.7%. D11 increased to $122/sq ft, which is an increase of 8.2%. And D49 had an increase to $105/sq ft, which is an increase of 2.9%. It is interesting to note that D11 and D20 have the same price/total square foot in 2017. This is because D11 typically has smaller houses so the price/total square foot will be higher as a rule. It could also be driven by the average price point where D11's lower prices attract more buyers competing for the home, driving prices up.
The number of distressed properties to include bank owned and short
The percentage of distressed properties for Academy School District 20 decreased from 6% to 4%, while D11 dropped from 13% to 6%, and D49 decreased from 10% to 3%. Once again, with the recovering housing market, homeowners are finding that they have enough equity in their homes that they do not need to sell their homes using a short sale. My experience is that most of the distressed properties are bank owned properties and probably due to the result of a job loss or transfer.
Academy School District 20 continues to average among the lower number of distressed properties, this is probably due to a higher economic status for buyers in D20 who are often professionals and have previously purchased homes, used a conforming loan, and probably purchased the home with a down payment resulting in instant equity in the home. The likelihood of defaulting is lower with those who purchase their home with a down payment for two reasons; 1) those who can save for the down payment typically have other funds to draw on to make payments when they are in a financial bind and 2) having the equity in the home would allow them to sell the home below market, though at a personal financial loss to them, before going into foreclosure.
Once again we saw a decrease in seller concessions in all three school districts. Seller concessions are very popular during a buyer’s market. To improve their chances of a sale, sellers frequently offer or agree to pay a portion of the buyer’s closing costs or for other improvements. Higher concessions are indicative of the desperation of the seller and also an indication that the seller is willing to give up equity in return for selling the home. Once in a seller's market, average concessions decline. This is the result of
For Academy District 20, Seller concessions decreased 33% from one year ago. D11 decreased only 0.6% and D49 decreased 7.7%.
In 2017 Sellers were not having to negotiate much on price. The sales price/list price ratio was 99% for D20, 98.6% for D11, and 99.5% for D49. D11 and D49 average days on market were 47 and 48, while D20 Days on market was a bit higher at 76. Typically, higher priced homes take longer to sell, but it is still under 3 months for D20 which is very good.
In summary, it is our opinion that based on the January 2017 housing statistics, that homes purchased in any of the three school districts will retain their value, as long as the housing market continues to improve. The statistics for January 2017 show that D20, D11, and D49 all faired well at retaining or gaining in price/sq ft. In previous years Academy District 20 clearly showed an advantage, but this year, like last year, we are not seeing this based on the average sales price and median sales price.
It is still a good time to sell or buy. Sellers often receive multiple offers for well-priced homes in good condition. Buyers should consider buying now while interest rates are still low and before the prices appreciate too much.
By Nancy Murray
Murray & Associates, Keller Williams Colorado Springs