Colorado Springs-area home prices rocketed to record highs again last month, as furious demand and a historically low supply of properties available for purchase continued to send housing costs soaring.

“It’s still a crazy market,” said Ann Kidd, a real estate agent with Truth North Realty in Colorado Springs and this year’s Pikes Peak Association of Realtors board chairwoman.

The median price, or midpoint, of single-family and patio homes that were sold in February climbed to $465,000, a 15.4% year-over-year increase and $15,000 higher than the record of $450,000 set last year, according to a Pikes Peak Association of Realtors market trends report released Thursday.

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The average price of homes also rose to a record high of $514,757 in February, the report showed. That’s up 13.2% from the same month last year and almost $4,600 more than the record of $510,180 in October. The average price, however, is considered less reliable by some industry experts because it can fluctuate with just a few extreme sale prices.

Year-over-year median and average prices now have risen every month since December 2014, a more than seven-year stretch.

Other highlights of the Realtors Association report show:

• The inventory of homes for sale at the end of February stood at 487. That’s the third lowest total for any month going back just over 25 years, according to historical data maintained by The Gazette. If no more properties came on the market, February’s home inventory would last for only two weeks based on the recent pace of home sales, according to the Realtors report.

• Home sales in February totaled 1,015, up 3.5% over the same month in 2021. 

• Houses averaged 13 days on the market before selling, down from 20 days in February 2021.

Colorado Springs’ housing market, like many metro areas nationwide, has been plagued by a shortage of homes for sale.

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That low inventory has come at a time when historically low mortgage rates, strong job growth and a reasonably healthy economy — despite the COVID-19 pandemic — have fueled interest in home buying. Those factors have combined to create a market in which sellers pick and choose from multiple offers that typically top their asking prices by thousands of dollars — even tens of thousands.

Buyers, meanwhile, are left scrambling, engaging in bidding wars and often walking away disappointed.

“It’s 100% a seller’s market,” said Patrick Muldoon of Muldoon Associates in the Springs. “The buyers just simply do not have a chance.”

Many times, buyers must make concessions to sellers if they want to close the deal, he said.

If the two sides reach an agreement, but a property appraisal comes in much lower than the agreed-upon sales price, the buyer typically must make up the difference with cash, Muldoon said. That appraisal gap, as it’s called, has grown by thousands of dollars over the last few months, he said.

Buyers also include include escalation clauses in their offers, spelling out that they’ll top the next highest bid by thousands of dollars — up to a certain ceiling — as a way of ensuring they’ll win the home, Muldoon said.

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Kidd, meanwhile, said buyers often have to lower their sights and look to buy in neighborhoods that aren’t at the top of their list while they settle for properties without the number of bedrooms and bathrooms they wanted.

“Specific property parameters that they hoped and wished for, they’re letting that go, honestly, just to get their foot in the door and get in the market,” she said.

Homes just don’t stay on the market long, Kidd said. Agents advise sellers to list their home on a Friday, take off for the weekend and then return Monday or Tuesday to sort through the flood of offers, she said.

“One of the things that we measure (is) days on market,” Kidd said. “It should say hours on market or minutes on market.”

Neither Kidd nor Muldoon see any changes in the market.

If mortgage rates rise, don’t expect demand to slow to a point where the market cools, Muldoon said.

And even if some local buyers remain on the sidelines, large corporate investors who’ve snapped up homes in Colorado Springs and other markets with the intent of renting the properties seemingly have unlimited funds and will keep on buying, he said.

At the same time, the market no longer seems affected by national and international issues, he said.

The onset of the COVID-19 pandemic two years ago triggered a brief pause before the market then took off again, Muldoon said. The turmoil created by Russia’s invasion of Ukraine also seems like it will have no effect, he said.

“The things that used to trigger people to get concerned don’t really seem to be doing that,” Muldoon said. “You go to war in Ukraine and Russia and people would pause. Now it’s like that’s not even happening.”