Townhome and condos continue to see pressure on pricing

Why are Colorado Springs condos and townhomes harder to sell than houses or townhomes?  

The Colorado Springs housing market for Condos and Townhomes continues to see a decline in pricing and  numbers of units sold in 2011.   2010 pricing decreased by 3% from 2009 and 2011 pricing has currently declined by 5% from 2010.    There were more units sold in 2010 vs. 2009.

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There are 5 main reasons that condos and townhomes are currently harder to sale than a Single Family Home in Colorado Springs

1. As foreclosures continue to hit the Colorado Springs home market, buyers are now choosing houses over townhomes since they can get them for about the same price.
2. There continues to be an over-supply of townhomes and condos, as there is currently over 8 months of townhome/condo inventory on the market.  It’s a buyer’s market.
3. Financing guidelines continue to impact the market.
   1. An entire complex must be approved for a buyer to use FHA financing. 
   2. The addition of HOA fees impact how much a buyer can qualify for.   A lender must include them in qualifying a buyer for the monthly payments, which can exclude some buyers.   HOA fees can run from $100.00 to over $400.00 a month.
4. Some potential buyers may back out of the purchase when they review the HOA documents.   Many buyers are concerned about the possibility of special assessmentss, inadequate financial reserves, rules about pets, and parking and guest rules.
5. Fannie Mae may decide not to loan on a unit in any complex that is involved in any type of litigation.

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Kathy (719-287-1049)   KTorline@msn.com