May 2—The Colorado Springs-area housing market remained in a funk last month as home sales, prices and construction fell again, two industry reports show.

In April, sales of Springs-area single-family and patio homes totaled 1,090, a nearly 27% drop from the same month last year, according to a Pikes Peak Association of Realtors' market trends report released this week. Home sales now have declined for 11 straight months.

It's also taking longer to sell homes, which spent an average of 39 days on the market before selling in April, the report shows. That's more than three times longer than a year ago, when homes spent an average of 12 days on the market in April 2022 before selling.

The median price, or mid-point, of homes that sold in April declined 5.3% to $459,000 from $484,450 in April 2022, the association's report showed. Year-over-year prices now have fallen four of the last five months, which followed an eight-year streak in which prices increased every month during that span.

The supply of homes listed for sale totaled 1,590 at the end of April, which was almost two-thirds higher than during the same month last year, according to the Realtors Association's report. That latest figure translates to a 1 1/2 -month supply of homes available for purchase, based on the number of listings and the recent pace of sales. The supply of homes for sale, however, still is historically low, according to data maintained by The Gazette.

The Realtors Association report reflects sales handled by real estate agents and not individual homeowners; most sales take place in El Paso County, with some in Teller and a handful of other Front Range counties.

Meanwhile, the pace of homebuilding also struggled last month.

Permits issued for the construction of single-family, detached homes in El Paso County — excluding townhomes and condominiums — totaled 203 in April, a 48.4% decline from 393 permits issued in April 2022, according to a Pikes Peak Regional Building Department report. Single-family permits now have dropped for 10 straight months on a year-over-year basis.

Blame last year's spike in mortgage rates for the current slowdown, housing industry experts have said.

At the start of 2022, 30-year, fixed-rate mortgages averaged a little more than 3% nationally, according to mortgage buyer Freddie Mac. After the Federal Reserve launched a series of interest rate hikes a year ago in an effort to slow inflation, mortgage rates rose, too.

By the end of last year, long-term mortgage rates stood at 6.42%, Freddie Mac figures show. Last week, they averaged 6.43% nationally.

Those higher rates have driven up monthly mortgage payments, priced some buyers out of the market and triggered a slowdown from the frenzied buying, selling and building that took place over the last few years, industry experts have said.

"It has simply slowed, and simply because of interest rates," Bruce Betts, a real estate agent with Re/Max Advantage in Colorado Springs and the brokerage's former owner, said of the local housing market.

But the market isn't foundering like it was in the Great Recession years, Betts said.

That's when demand and home sales plunged. Monthly inventories, meanwhile, were sky high — exceeding 7,000 homes in each of July and August 2007 and topping 5,000 and 6,000 for several months from 2008 through 2010, Gazette historical data show.

Though the market is far from Great Recession levels, it remains complicated, Betts said.

Sellers need to accept that higher mortgage rates have led to softer demand, he said. As a result, sellers won't necessarily be able to command top dollar as they did before the slowdown — though nice homes in good condition and priced realistically still can receive multiple offers and sell quickly, Betts said.

At the same time, buyers must understand that even as home prices have fallen, they haven't dropped to a point where they will offset higher mortgage payments, he said.

"We have 1,500 homes on the market and 1,000 or 1,100 sold in a month," Betts said. "That's not a cratering market. That's not a buyer's market at all. That's a really strong, healthy market for sellers. But they have to be realistic about their price.

"It's not cratered, it's not crashed or any other words like that at all," Betts added. "It's slowed from what it was. It's not as crazy as what it was. It's a more balanced market."