Homebuilders working to ease affordability crisis for first-time buyers

Those of us with younger family and friends know how difficult it is for these residents to purchase a home. Because home prices have soared over the past 10 years — from 4 to 5.6 times the median income — more of our younger community members are renting homes longer while they increase their incomes and try to save the lump sum of a down payment.

Because of these fiscal headwinds, the average age of the first-time homebuyer has increased over the past decade from 31 to 40 years, delaying marriages and families while young people gain financial stability.

These young families are desperately searching for a home they can afford. But even as home prices have begun to drop, the median home price in El Paso County came in at $480,000 at the end of April, up from $460,000 at the end of 2025. To afford a home at this price, a family must also consider the monthly costs of ever-rising property taxes and home insurance on top of their mortgage payment, which also includes a rising 6.5% interest rate and possibly a homeowners association fee.

Assuming a 10% down payment, this brings the monthly mortgage cost to almost $3,500 per month, or $42,000 for the year. If a family pays only 30% of their income on housing costs, which is what a lender will typically allow, a family would need to earn $140,000 to afford this home purchase. This price may work for some couples, but it is largely keeping many young families in rental housing.

Making this equation even more difficult is the lack of lower-priced homes on the market in El Paso County. Reviewing home prices on Zillow reveals the unfortunate fact that not many homes for sale are affordable for many of our families. The median income in El Paso County for a family of four is currently $110,000, and with the median home price requiring an income of $140,000, there are limited purchase options for lower-income families.

By way of example, on May 15, here were 3,294 homes for sale in Colorado Springs. This includes single-family homes, townhouses, condos, duplexes and triplexes. A family earning the median income of $110,000 can financially afford a mortgage payment of $2,750, which will qualify them for a home purchase between $350,000 and $400,000. On this specific day in May, 855 homes, or 26%, were for sale in this price range. This may seem like a lot of homes, but when one dials down to the area of the city in which they’d like to live, likely close to a job or good school, this number drops precipitously, acutely highlighting the mismatch between homes for sale and the homes our residents can afford.

Local homebuilders are responding to this housing mismatch by building smaller and more creative homes. According to the Federal Reserve Bank of St. Louis, in April 2020 the average size of the housing inventory in El Paso County was 3,092 square feet. In April of this year, this number was 2,183, showing a decrease of 909 square feet over the past six years. This size reduction was intentionally manufactured by our local builders who are doing all they can to meet the diverse housing needs for all of our residents, while ensuring our neighborhoods remain welcoming and strong.

While families continue to struggle with the rising cost of living, the Pikes Peak region is leading the way in Colorado to rein in costs, by producing more housing at lower price points, reducing our ever-increasing regulatory environment, and growing our economy by bringing more employers and jobs to the region.

Producing a wide spectrum of housing price points benefits our employers and our workforce, who together are the engine of our region. Heterogeneous neighborhoods and communities are more resilient and attractive to employers. Building attainable housing in mature neighborhoods brings together older and younger residents and creating stable and sustainable neighborhoods and communities. Supporting housing production, especially starter homes and rental housing, is a great way to ensure our region remains strong and able to withstand any winds of change that may come our way.

Jill Gaebler is executive director of the Pikes Peak Housing Network.