LOOKING BACK ON THE YEAR IN REAL ESTATE

 

Our region proved its resilience once again, with home sales increasing by 5.28% to 8,389. The median price for the region ended 2025 at $521,500, holding stable with 0.95% annual growth.

Behind these numbers lies a shift in strategy. Sellers faced increased competition and embraced dynamic pricing, often using concessions to attract interest. Buyers adapted to higher rates by becoming more surgical in their search, prioritizing turnkey properties and leveraging concessions to solve the affordability puzzle.

The 2025 housing market experienced a Rate Reality Check. While we did not see a dramatic pivot, rates settled into a new normal by averaging roughly 6.6% for much of the year before dipping into the low 6% range in the fourth quarter.

Record home prices and limited inventory strained affordability in 2025, compounded by rising property taxes and insurance premiums. As insurers reduced coverage options in Colorado, policies became more expensive and harder to secure. Conditions began to improve in the fourth quarter as fewer major weather events signaled a more stable insurance outlook for 2026.

Condo and townhome sales declined 3% to 1,582 units, with the median price down 1.16% to $393,176. While high HOA fees and insurance costs weighed on the segment in 2025, increased focus on higher-density development is expected to support improved stability and inventory ahead.

The regional market has shifted to a neutral, buyer-favored environment, ending more than a decade of seller dominance. Increased resale inventory and aggressive new-construction incentives have given buyers greater leverage on price and terms than they have had in years.

Demand patterns also evolved. Remote work weakened the link between local employment and housing demand, as many residents now work for employers elsewhere. At the same time, the Grandbaby Effect brought retiring Boomers closer to family, helping stabilize the market during a year of transition.

Real estate is local, and we continued to see different market dynamics at play. Nowhere was this more evident than in Johnstown. Regional areas with new construction growth priced competitively below the region’s median saw a strong surge in sales demand. Johnstown’s strong new construction presence led to a region-leading increase in sales, ending the year at 715 for a 29.76% increase. Builders proved this by offering more affordable products and attractive financing, driving significant growth and delivering solutions to affordability challenges that held other markets back.

 

Read the Full Article here: February 2025 Insider