For decades, Colorado Springs and El Paso County leapt rooftops ahead of housing demand and now fall so short that it’s uncertain whether catching up to the growing need is feasible, a new Regional Housing Needs Assessment shows.

While the 314-page report concludes that “no market segment is adequately served,” sectors having the most problems with securing housing are low-income residents, people exiting homelessness, singles, seniors and active-duty military.

Colorado Springs City Council heard the data during a presentation at Monday’s work session, not in seeking approval for the document but as informational.

“The challenges are significant, but so are the benefits, if we can ensure all residents have the safe and secure homes they need to flourish in this society,” said Aimee Cox, the city’s chief housing and homelessness response officer.

The findings estimate that there’s a countywide shortfall of 27,000 units as of 2023 and a projected need of 60,034 units in total by 2035.

“Approximately two to two-and-a-half times the community’s average annual housing production is needed to catch up,” the study found.

Housing inventory and costs have become a top issue, Cox said, because the topic affects every employer and resident — from homeless people to wealthy people.

Obstacles mentioned include securing funding mechanisms, higher costs of building supplies, labor availability, public sentiment and the so-called “not in my backyard” syndrome and red-tape requirements for developing affordable housing.

Yet officials said after the presentation they’re optimistic that the community will rally together under a forthcoming action plan to make gains.

“In the past two months, we closed on 712 more affordable housing units,” Cox said. “We are making progress; we act and will continue to act on the needs identified in this report.”

The situation didn’t happen overnight — it’s been a long time in the making, said Tatiana Bailey, owner of Data-Driven Economic Strategies, which conducted some of the research.

Underbuilding of new homes, apartments, duplexes and condominiums started during the Great Recession, between December of 2007 to June of 2009, the report states. And it’s continued.

The study found that from 2006 to 2024, the region averaged 3,021 annual single-family housing permits, which is 5,479 less than what it should have been — at 8,500 per year.

One reason is population growth, said Bailey. Though population projections for the region have been downgraded, estimates remain on a slower but steady upward trajectory.

Last year, El Paso County’s population weighed in at 752,892, according to the American Community Survey, up from 397,289 in 1990.

The Colorado State Demography Office projects the county’s population will hit 965,622 by 2050 — a decrease from the more than 1 million that had been forecast.

Between 2010 and 2023, the city added 30,000 households and 36,000 new homes, reflecting an improvement in stock, said James McMurray, project manager with Matrix Design Group, the research consultant.

In general, the county’s population is a little older and smarter, with 42% of adults holding a bachelor’s degree, and more financially stable than 2018-2023, he said.

But wages have not kept pace with rising rents and mortgages, he said. Of the county’s 200,000 residential households, 61% own their homes and 39% lease units.

Residential rent prices averaged $1,784 in March, McMurray pointed out. Thus, a household in Colorado Springs would need to earn $78,693 to “comfortably afford this rent,” the study says. Just above one-third of renters meet that threshold.

“About 55% of our population earns under $75,000 a fairly significant income threshold as it relates to housing affordability,” McMurray said.

One-third of homeowners also are “cost-burdened” by housing expenses and do not meet the $150,000 annual income needed to afford an average valued house of $457,000 in Colorado Springs.

The 2023 median household income of $87,470 in Colorado Springs was below the statewide median of $92,470. El Paso County’s median income was $102,825.

“Market choice is limited, and homeownership is increasingly out of reach for many, as housing costs continue to outpace income growth,” McMurray said.

Median housing values in the unincorporated county and metro area increased by about 40% from 2018 to 2023, which was above Colorado’s median increase of 32%.

Of the total 27,000 units needed currently, 11,775 are rental units and nearly 16,000 are owned units.

Also included are about 2,000 supportive housing units for people leaving homelessness and requiring assistance with substance addiction or other mental health conditions.

The military’s basic allowance for housing falls below the monthly ownership or rental costs for most of the area’s military families and singles, particularly junior and mid-grade enlisted personnel, the report also determined.

“Continued attention to housing affordability, proximity and unit diversity is essential to sustain the region’s defense workforce and operational effectiveness,” the report says.

The Colorado Springs Housing Action Plan that will be released in the first quarter of the coming year will contain strategies to help identify funding to carry out the ideas; adjust policies around zoning, development and parking requirements; coordinate regionally; prevent foreclosures; and manage affordable housing, among others.

Public input will be sought at community meetings and presentations, officials said.

A Senate bill state lawmakers passed last year mandates that every Colorado community conduct such a study and a subsequent action plan.

The assessment for El Paso County, the state’s largest county and Colorado Springs, the state’s second-largest city, is among the first to be released under the new law, according to Katie Sunderlin, housing solutions manager for the city.

Numbers from the new housing assessment

El Paso County population as of 2024: 752,892

Of the county’s 200,000 households, 61% own their homes and 39% lease units

All types of housing units needed currently: 27,000

Housing units projected to be needed by 2035: 60,034

Average asking rent in Colorado Springs as of March: $1,784

A household would need to earn $78,693 in Colorado Springs market to comfortably afford the average rent; 36% of renters meet that threshold

Median renter income: $58,325

Average home value in Colorado Springs as of March: $457,000

A household would need to earn over $150,000 to afford average home in Colorado Springs market; 30% of home buyers meet this threshold

Median homeowner income: $106,625