Dreaming of buying a $1 million mansion in the Pikes Peak region?
Maybe a custom home with exotic hardwood floors, stainless steel appliances, a gourmet kitchen, theater room, wine cellar, more bathrooms than bedrooms and majestic views?
Whether you have the cash on hand or would need to get lucky in the lottery, get in line. The demand for luxury properties in Colorado Springs and surrounding areas has gone through the roof — a decorative, slate-tiled roof, of course.
"The demand is high right now, even at that price point," said George Nehme, a real estate agent with the Springs office of upscale brokerage LIV Sotheby's International Realty and Pikes Peak Association of Realtors board chairman. "And the good ones sell very fast."
Springs-area home prices — similar to markets nationwide — have skyrocketed in recent years. In general, a shortage of homes and a buying spree driven by historically low mortgage rates have led to multiple offers, bidding wars and escalating prices, real estate agents and builders have said.
The median price of local single-family homes that sold in August remained at a record high of $450,000 for a third consecutive month, according to a recent Realtors Association report that tracks sales in El Paso, Teller and other Front Range counties.
August's price climbed 18.4% over the same month a year ago; it was the 14th straight month of double-digit gains on a year-over-year basis.
As prices have soared, fewer homes that once were considered to be affordable — those going for $400,000 or less — are available. And, not surprisingly, as the supply of cheaper homes shrinks and prices rise, sales of more expensive homes are on the rise.
But it's not just that prices have gone up that's resulted in increased sales of luxury homes; the properties, say real estate agents and builders, are simply more in demand.
Realtors Association statistics show:
• Five years ago, 1,240, or 85.4%, of 1,452 single-family homes and patio homes sold in August 2016 were priced at $399,999 or less. Last month, 574, or 30.7%, of 1,870 homes sold were in the same price range.
• In August 2016, 83 homes sold in the $500,000 to $799,999 price range or 5.7% of that month's total sales. In August 2021, 574 homes or 30.7% sold between $500,000 and $799,999.
• There were six home sales between $800,000 and $999,999 in August 2016; last month's total was 66.
• When it comes to $1 million-and-up homes, only seven were sold in August 2016; last month, 43 sales topped the $1 million mark.
• Last month's seven-figure sales is part of a year-long trend. Through the first eight months of 2021, there have been 321 sales of $1 million-and-up homes. For all of 2016, there were just 45.
Why such a strong demand for higher-end homes in the Colorado Springs area, and who can afford them?
Some buyers have come from larger, more expensive metro areas and have sold their equity-laden, million-dollar properties in other markets, Nehme said. They now have large amounts of cash to invest in a posh home when they arrive in the Colorado Springs area, he said.
"Some of them have made up to a half million dollars in equity in such a short period of time on million-dollar-plus homes," he said. "So, they're bringing that money here because of what we offer — lifestyle, amenities."
Keep reading on The Gazette.
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