Colorado Springs, CO has remained a strong and sustainable housing market throughout 2024. We’re talking today about some of the real estate trends that we’ve been tracking this year, and what they mean for buyers, sellers, investors, and renters.
We’re calling this a seller’s market in 2024, and that’s because the demand outweighs the supply, offering sellers a favorable environment for negotiating the best deals on the sale of their properties. Homes in this market are earning their asking prices, or at least getting close. We can also tell you that there’s a sale-to-list price ratio standing at an unusual 100 percent.
Buyers want to find homes, even with mortgages being more expensive this year. That’s good news if you’re selling a property, and if you’re buying – make sure you come to the table prepared to make a good offer and move quickly.
Let’s dive into some specific trends that can help you position yourself and your investment portfolio for gains the rest of this year and into the next.
Trends in the Local Market
A lot of the owners and investors we work with ask about the real estate market forecast and the outlook for the market for the rest of this year. So, let’s take a look at some of the market dynamics we’ve been following.
- The median days on market is at 34 days on average. This tells us that demand is healthy. It reflects the speed with which properties are moving from listed to sold.
- Over the past year, the median days on market has trended downward, confirming our estimates that there’s plenty of demand in the Colorado Springs housing market.
Looking ahead, we expect continued high performance. Colorado Springs is enjoying a strong local economy, a lot of new population growth, and an ideal spot for the growing number of remote workers who are leaving larger cities in search of a better quality of life that’s more affordable.
While median listing home prices have remained relatively stable in the mid $400,000 range, the demand-supply dynamics favor sellers, accentuating the need for proactive strategies among buyers.
Trending Towards Single Family Homes
We have seen a lot of growth in specific sectors, especially single-family homes. These types of rental properties have always been popular among tenants who wanted the experience of owning a home without any of the financial responsibilities or maintenance requirements.
New listings in Colorado Springs have surged by 16.7%, indicating that there’s an opportunity for real estate investors who want to rent out single-family homes.
One of the most important reasons that single-family homes make good investment properties is that they appreciate so well. Recently, median sales prices climbed by 2.2%, indicating that these property types remain desirable among both home buyers and renters.
Just because single-family homes are hot does not mean that investors should be ignoring multi-family properties. The inventory is growing in Colorado Springs, thanks to the demand for affordable, community-based homes. Investing in a small apartment building can provide an owner with a great hedge against risk. One vacancy will not completely disrupt your rental income when you have multiple rents coming in from one investment property.
Colorado Springs Rental Market Trends
We expect that Colorado Springs will continue to grow as a desirable rental market. People who are moving here are more likely to rent than buy. The trends we’re watching involve student markets, military markets, and retirees. The Air Force Academy is located in Colorado Springs and the University of Colorado Springs is home to more than twelve thousand students. Colorado College, Colorado Technical College, Remington College, Colorado Christian University, and the University of the Rockies are also located here. This provides a large, diverse student market that rents properties across the Colorado Springs real estate market.
Active adults are moving to Colorado Springs for their retirement, and this is also growing our population and contributing to a demand for housing. This population of tenants look for low-maintenance housing that’s inclusive of amenities and activities.
Here’s what the data shows us about rental trends in Colorado Springs this year:
- As of March 2024, the median rent for all bedroom counts and property types in Colorado Springs, CO is $1,774.
- That average is 10% lower than the national average, which keeps the market attractive to renters who are looking for value.
- Rent prices for all bedroom counts and property types in Colorado Springs, CO have decreased by 9% in the last month and have decreased by 11% in the last year. This is pretty typical of the way rents have stabilized across the country after several years of growth.
The occupancy distribution in Colorado Springs is as follows:
- Renter-occupied Households: 40%
- Owner-occupied Households: 60%
Tenant Trends in Colorado Springs
We’re going to focus on three important tenant trends in 2024 that have an impact on both the real estate market (where investors are) and the rental market (where investors rent out their homes). Here’s what we can tell you about remote work, energy efficiency, and smart home technology.
- Remote Work
Remote work’s sustaining effect on the workforce is leading tenants towards new geographic destinations. Because they no longer have to live within commuting distance of their employer, they’re free to choose the city that speaks to them. For a lot of remote workers, Colorado Springs is that city. If you’re a rental property owner hoping to attract remote workers, make sure you’re providing a rental home that appeals to their working life and their non-working life.
- Embracing Sustainability and Energy Efficiency
It’s time to make your rental property a little bit greener, especially if you want to attract more tenants and keep your own operational costs down. Over the last several years, sustainability has emerged as an important part of what tenants are looking for when they rent a home. Colorado, of course, has always been a leader in environmental protections, thanks to its dramatic natural landscapes and respect for resources. This trend is translating into good business for rental property owners. Homebuyers and renters are becoming more conscientious about the environmental impact of their properties, leading to a growing interest in energy-efficient homes. Adopting renewable energy sources and optimizing buildings for energy conservation can increase property value and appeal to eco-conscious tenants.
- Smart Home Technology
It doesn’t matter how you feel about smart home technology; tenants in Colorado Springs love it. They are increasingly looking for properties that offer smart home technology. This is an important trend that we tell all of our investor and landlord clients to watch for: tenants wanting and needing extra tech in the homes that they rent. Residents we talk to are currently looking for upgrades like video doorbells, digital keypads and smart locks, smart thermostats, and apps that allow them to turn on lights and lock doors remotely. It’s about convenience for them, and it’s an important way to think about the way you make updates and improvements to your property.
Those high quality tenants will continue to look for homes that provide smart home technology, and the property owners and managers who can provide it will have an easier time attracting and retaining their perfect tenants.
Trends in Tenant Satisfaction and Customer Service
The real estate market, generally, is about earning as much as you can and maximizing your return on investment. Lately, though, a lot of people in that market have realized that it’s a relationship business. Customer service is emerging as a more important trend than technology or anything else. Providing a great experience is a trend that’s been picking up a lot of momentum over the last few years.
This is not a trend that’s unique to the Colorado Springs rental market, but it’s worth talking about because it impacts how you buy, sell, and rent out homes. All the technology that’s available to us is actually in the service of better customer support. That automation and data collection means that we can spend more time focusing on relationships.
Providing an exceptional tenant experience in your rental home is an excellent way to grow a business and it’s a trend that will continue to develop into more meaningful outcomes. Landlords and property managers need to invest in their tenants. These are your paying customers. When you’re focused on advertising and marketing more strategically, investing in objective tenant screening, and committing to great customer service for your tenants, you’ll be satisfied with the results that you achieve.
Smart investors understand that Colorado Springs property management is your best resource when it comes to tenant satisfaction. We can focus on the relationship and make sure they’re getting everything they need during the tenancy.
The real estate market is always changing, and we’re lucky to be here in the Colorado Springs market. The property management industry is strongly connected to the real estate trends, and it’s an industry that’s always growing. While we don’t have a crystal ball that can tell us the future, we have a sense of what’s coming and how to best prepare for it.
Let’s talk more about it. Contact us at Muldoon Associates.
