The pace of home building in the Colorado Springs area so far in 2022 is off to one of its best starts in 20 years.
In the first quarter, the Pikes Peak Regional Building Department issued 1,159 permits for the construction of single-family homes in El Paso County, according to a report from the city-county agency.
The figure includes permits for single-family detached homes, but not townhouses, duplexes, apartments and other dwellings.
For one thing, total Q1 permits fell 16.4% from the same period in 2021.
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Still, this year’s total single-family home permits for the first quarter ranked third for any similar period since 2003, according to regional construction reports and historical Gazette data.
It only tracked the 1,387 permits issued in the first quarter of last year and the 1,393 issued in the first quarter of 2005, which was a record year for single-family building permits.
Overall, robust permit activity so far in 2022 is a sign of continued strength in the homebuilding industry and overall housing demand in Colorado Springs and the Pikes Peak area, some builders say. of houses.
Not only is the area’s population booming, but Colorado Springs’ opportunity as a place to live has been recognized in recent years by US News & World Report.
Last week, the Springs won ninth place from the Milken Institute in the California think tank’s annual list of top cities based on economic performance.
“We still have a significant, unmet need for housing in our area,” said Ed Gonzalez, vice president and co-owner of Campbell Homes, a Colorado Springs builder for nearly 60 years.
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That demand for new homes slowed late last year as the market “took a breather” and builders saw a sharp drop in traffic among potential buyers, he said.
Since mid-January of this year, however, buyer traffic has picked up and Campbell Homes has seen increased sales and signed contracts in the past eight weeks, Gonzalez said.
“Breathing can only last for a while,” he said. “People still need to buy new homes or resell homes. It just took a little break and everything is back to where it should be.
“It’s strong for us,” Gonzalez added of Campbell Homes sales. “And when I talk to other builders, they see the same thing we do. Their sales are also strong. We all saw a drop in traffic at the end of last year, but it picked up.”
Not only are more people living in Colorado Springs, but a historically low inventory of homes available for sale on the resale side of the market has prompted many buyers to consider new homes, Gonzalez said.
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Even though long-term mortgage rates have risen in recent weeks, the increases haven’t significantly reduced buyers’ appetite for new homes, he said.
A year ago, over 30 years, fixed-rate mortgage rates averaged 3.18% nationally, according to mortgage buyer Freddie Mac. Last week, 30-year fixed rate mortgages averaged 4.67%.
“It’s still an incredibly low rate, based on historical averages,” Gonzalez said.
And while supply chain issues have caused delays in getting building materials, windows, appliances and other items, those issues aren’t stopping home construction, a- he declared.
“They haven’t gotten better, but they haven’t gotten worse,” Gonzalez said of the supply chain issues. “It’s the good side and the bad side. It’s always going to be something we’re going to fight for the vast majority of this year.”
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The homebuilding industry has been a key cog in Colorado Springs’ economy for decades. As a result, economists and city officials are paying close attention to the pace of home construction.
The industry employs thousands of carpenters, drywall workers, electricians and other workers, whose paychecks help pump money into the economy when they buy cars, TVs, appliances , etc.
The Springs and other local governments, meanwhile, levy a sales tax on the purchase of building materials that brings in millions a year to pay for roads, public safety and other basic services.