Area home sales drop for the sixth consecutive month in November as price hikes slow to a crawl.

Colorado Springs-area home sales tumbled by more than a third in November from a year ago, while prices eked out their smallest gain in nearly seven years — more signs that higher mortgage rates have chilled the local housing market.

According to a Pikes Peak Association of Realtors report released this week:

• November home sales totaled 936, a 36.2% decline when compared with the same month last year. It was the largest percentage drop in year-overyear sales in nearly three decades’ worth of housing data compiled by The Gazette. Year-over-year sales now have fallen for six straight months; November also was the first month that sales totaled less than 1,000 since February 2021. Most home sales reported by the Realtors Association took place in El Paso County, though some were in Teller and a handful of Front Range counties.

• The median price, or midpoint, of homes that were sold in November inched up to $453,000, a 0.7% increase over the same month last year. That percentage increase was the lowest since January 2016, when prices rose by a similar amount. The average price, considered by industry experts to be a less reliable measure because it can vary with a few very high or low sales, was $525,923 in November, a 3.6% year-over-year increase.

• At the end of November, 2,430 homes were listed for sale, which was nearly three times as many as the

same month last year. Based on that figure and the recent pace of home sales, there’s now a 2.6-month inventory of homes for sale. A year ago, there was just over a halfmonth’s supply of properties available.

Housing industry experts say soaring mortgage rates are the main reason for the market slowdown.

A year ago, 30-year, fixedrate mortgages averaged 3.11% nationally, according to mortgage buyer Freddie Mac. This week, after months of interest rate hikes by the Federal Reserve in an effort to get inflation under control, the 30-year, fixed-rate mortgage rate stood at 6.49%.

Combined with home prices that had escalated by more than 10% each of the last five years, the rapid spike in mortgage rates has priced many homebuyers out of the market and led to plunging home sales, said Rick Van Wieren, a real estate agent with Re/ Max Properties in Colorado Springs.

“When you double the interest rate, it just kind of puts a chokehold on people’s ability to make the payment on the more expensive houses we’re into,” Van Wieren said.

“(With) these double-digit run-ups in prices, combined with the doubling in interest rates, you end up with just an affordability conundrum that people aren’t going to get past that quickly. You can’t change anything other than just stepping out of the market until it gets a little better.”

The slowdown in home sales is a big concern, Van Wieren said, though the sky isn’t necessarily falling on the housing market.

The 2.6-month supply of homes for sale gives buyers more choices, he said. Home sellers in November, on average, still received 98.3% of their asking price — not as good as the more than 100% in recent years, but still a healthy number and in line with historical norms, he said.

Also, the median number of days that homes spent on the market before selling was 22 in November, far more than in past years, yet still a reasonable amount of time in which to find a buyer, Van Wieren said.

“None of those numbers are out of whack,” he said.

There are signs that mortgage rates will start to moderate, though it could take six to 12 months for rates to return to a level that will draw more buyers back to the market, Van Wieren said.

“When we see 5% again, that will give a little more of a kick-start to things,” he said.