Real Estate

Pueblo’s housing market is falling. Fed rate pauses: relief? 2023

According to the most recent local data, Pueblo’s real estate market is continuing to deteriorate, and all eyes are on the Federal Reserve to see if interest rates will be raised again next week or finally see a respite.

In light of Friday’s failure of the Silicon Valley Bank, a number of financial analysts anticipate a stop in the interest rate rises. The next Fed meeting is scheduled on March 22.

“Interest rates have been on the rise for over a year, but the expected changes have not occurred. People continue to work and spend money, according to Pueblo Association of Realtors spokesperson Dave Anderson.

The Fed held the federal funds rate close to zero as recently as the beginning of 2022. Anderson stated that if the Fed decides to suspend the changing interest rates between 5% and 6% in the Pueblo region, “that would be preferable to another increase.”

“It won’t instantly affect interest rates, but there will be a psychological shift,” he stated. People’s disposition may improve (real estate market activity).

Anderson remarked that current interest rates, although appearing high in comparison to previous historically low rates, “remain at the bottom of the 50-year average.”

Below are the February statistics for Pueblo.
In February, the Pueblo Association of Realtors reported 178 properties sold for a total of $57.6 million, compared to 263 homes sold for $83.5 million in 2022; this is a 32% decrease in homes sold and a 31% fall in sales price income.

“A combination of factors resulted in mixed outcomes for the real estate market in the Pueblo region in February, with the median price increasing 4.9% to $320,000 compared to February 2022.” “Anderson stated. The decreasing trends were highlighted by a 17.5% decline in new listings from February 2022 and a 26.7% decline in pending sales from 270 to 198.

In 2020, this number will be as low as 30 days. Now, homes are on the market for an average of 92 days; in 2020, this figure will be as low as 30 days.

“It’s taking longer to sell something, while it used to be quicker,” Anderson remarked.

Current sellers are receiving, on average, 98% of their asking price.

“Sellers must be more practical, therefore we continue to see price decreases,” said Anderson.

Although Anderson anticipates a little increase in real estate activity during the spring, he predicts that interest rates will fall further by the end of the year, which might stimulate even more activity.

More real estate news: 2 Pueblo commercial buildings sell for over $7 million; residential sales continue to fall.

New house construction is also slowing
Moreover, the high federal interest rates continue to affect new house construction in Pueblo County.

The builders of new homes continue to be cautious: In February, just 20 new permits were issued in Pueblo County, and 12 in Pueblo West, according to Anderson.

SkyCreek Homes and Cogswell Homes are continuing to construct new houses in the area. As they did during the housing crisis in 2008 and 2009, some builders have shifted their focus to renovation.

“At least they can keep some folks occupied. “They are persevering and performing admirably,” Anderson added.

According to him, Pueblo West remains popular among homebuyers because its bigger lots, which average an acre in size, allow homeowners to build a separate barn or garage for their “toys.”

“Pueblo West will remain popular until it runs out of building lots,” he said. These additional structures are not permitted on the tiny parcels in Pueblo.

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