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COLORADO SPRINGS, COLO. -- The struggling Colorado Springs housing market may be getting a boost over the next couple of months.

Mortgage rates are at about 5 percent down about 1 percent from a couple months ago.

The federal government's stimulus package may grant home buyers an $8,000 dollar tax credit.

And the Army is anticipating thousands of military families coming to the Springs this year.

Another good indicator is that there are less homes on the market, but realtors still say people aren't going to get the full value of their homes.

"We're starting to see more of it sell," said broker associate Dave Archer.

Most of what is selling are bank-owned and short-sale homes, which have flooded the market.

"Right now it seems like we're in the short-sale, foreclosure-hot market, if you can say for investors or people in the position to buy," says Realtor Jeff Boals.

"Thirty-nine percent of homes sold last month were bank owned." Kaercher said. "The bank-owned homes have significantly lowered the price of homes. Once we start cleaning those up people will be able to get more money out of their homes."

The average price of a home in the Springs is $187,000, down from $219,000 last year.

In an attempt to stimulate slumping home sells, banks have dropped mortgage rates.

"With the rates coming down we'll have more purchases because it allows for more money to be put toward home payments," said mortgage broker Jason Craig.

For those who makes purchases, the stimulus package's promise of a tax credit for buying a home also helps.

"Great time for buyers. That's why the stimulus is geared toward buyers," Kaercher said.

"It kind of feels like that's the light at the end of the tunnel once we start seeing those disappear because it will help regular sellers, where the bank-owns aren't bringing down the values of people trying to sell their regular houses," Boals said.

A light that's near, but going to take a while to reach.

"It's going to take probably two years to clean this up to where homes values are back to where they were," Kaercher said.

The bottom line is there are a lot more incentives geared at stimulating the market for home buyers.

For those who have the money to invest, now would be a good time. For those looking to sell, realtors suggest holding off if possible until at least until summer.

They say those who must sell should consider short sales rather than allowing a home to go into foreclosure.

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