Springs area housing sales continue falling in August

The Colorado Springs area housing market slumped for a second consecutive month in August. Sales have declined in the past two months from a year earlier after posting gains every month for more than a year.

Sales of  newly built and existing homes last month totaled 688, down 22.8 percent from August 2009, according to a monthly report by the Pikes Peak Association of Realtors that tracks sales handled by its members. The sales slowdown comes as the supply of homes listed for sale rose 15.9 percent from a year ago to 5,839; it was the fifth consecutive month that the number of properties on the market was up from the same month a year earlier.

“The local housing market has taken a step backwards in recent months,” said Dave Bamberger, a partner in Summit Economics, a local economic research firm. “An explanation for the decline is that the federal tax credit (for first-time and move-up homebuyers) has expired. It is clear that the credit pulled buyers from the future and the market is paying the price for that today. I expect the housing market to remain slow though the end of the year.”

The program provided $8,000 in tax credits for first-time buyers and $6,500 for those moving to another house, but expired April 30  for most buyers; active-duty military personnel who were deployed overseas for at least 90 days in 2009 or through April 30 of this year get an extra year to make a home purchase.

Despite declining sales, the median price of area homes sold last month continued to climb, rising 4.8 percent from a year ago to $205,000. Area housing prices have increased for 10 consecutive months when compared to the same month a year earlier.

The rising prices have prompted some potential buyers to hold out for better prices; some sellers boosted selling prices a bit this summer while sales and prices were still both increasing, said Barbara Asbury, managing broker of Peak Realty & Consulting.

Asbury, who will become chairman of the Realtor association next month, believes the housing market will benefit from the lowest mortgage rates since the early 1950s.

“I believe the market will get better. I am cautiously optimistic. The market is improving, but very slowly,” Asbury said. “It is still a terrific time to buy a home. ... It is a rough time to be a seller, though.”