The pace of local homebuilding dipped again last month, but year-to-date construction activity continues to run ahead of last year, according to a Pikes Peak Regional Building Department report released Thursday.
“It’s still a very robust market. Lots to be hopeful for,” said Todd Anderson, incoming board president of the Housing & Building Association of Colorado Springs and owner of Shepherd Staff Consulting, a building industry and leadership development consulting firm.
In October, the Regional Building Department issued 258 permits for the construction of single-family homes in Colorado Springs and El Paso County, down 4.8 percent from the same month last year, the agency’s report showed. It was the third straight monthly decline in permits on a year-over-year basis.
Even so, permits issued through the first 10 months of 2018 totaled 3,345 — 13.2 percent higher than the same period last year, according to the Regional Building Department report. Year-to-date permits already have eclipsed the annual totals from 2007 through 2016 and remain on pace to be the highest since the record year of 2005.
Strong job growth, an influx of people moving to Colorado Springs and Denver-area homebuyers who are purchasing in the Pikes Peak region because of its lower housing costs are among the factors that have helped drive the local homebuilding market this year, Anderson said.
The market would be doing even better, but an uptick in long-term mortgage rates and higher home prices because of rising labor and material costs have kept some first-time buyers from making purchases, Anderson said.
Some move-up buyers, too, are taking longer to make decisions on purchases, he said.
Still, Anderson said, the market continues to be buoyed by a large influx of buyers who work in the Denver Tech Center, but have chosen to purchase new homes in northern Colorado Springs and El Paso County because housing costs are tens of thousands of dollars less.
“All you have to do is stand on Monument Hill in the morning and watch the cars go past,” Anderson said. “It’s pretty significant.”
The Colorado Springs-area homebuilding industry is a big part of the local economy and is closely watched economists, business leaders and city officials.
The industry employs thousands of people, such as framers, drywallers, electricians and others in the construction trades.
At the same time, Colorado Springs and other local governments depend on sales tax revenues from building material purchases to help fund their budgets and pay for public safety, parks and other services.