Here's a look at the latest Colorado real estate trends.
Millennials are priced out.
Despite its efforts to lure millennials to the city, metro Denver's soaring home and apartment prices mean that many millennials are priced out of urban living and home ownership. Denver is the No. 12 city on Bloomberg's "The 13 Cities Where Millennials Can't Afford a Home." In a city where the average home goes for nearly $400,000, and the median salary of 18-34-year-olds is $39,492 annually, according to the U.S. Census Bureau, the typical millennial worker doesn't earn enough to buy a home. Tom Clark, CEO of Metro Denver Economic Development Corp., says that may be the number one impediment to growth in the coming years.
Denver is hot, and we don't mean the weather.
On August 3rd, Realtor.com published its latest ranking of the “hottest” real estate markets in America. Housing markets with the most demand and the fastest selling homes are ranked at the top, and Denver was No. 2, beating out Los Angeles, San Diego and Dallas. Properties in these hot markets are viewed on Realtor.com nearly three times more often than the national average. In metro Denver, it appears to be the lack of inventory pushing up prices; the Denver housing market had 16.6 percent fewer homes for sale in the second quarter of 2015, compared to the same period last year. That said, recent data show that home sellers in the Denver real estate market are seeing fewer offers above the list price.
The seasonal slowdown may arrive early.
The experts agree, the Denver real estate market has cooled off a bit since June when the median home price increased 10.2 percent from a year earlier. While they are still high, prices are beginning to level off and in some cases even decrease slightly. According to a report from Denver Metro Association of Realtors, the median price of a home sold in metro Denver dropped 3.1 percent from June to July, and that cool down is expected to continue into August. Did home prices set a near-term peak in June, or did the seasonal slowdown just started sooner than usual? We'll just have to wait and see.
Some relief for the rental market?
In May, the average rent for an apartment in the metro area was $1,309, up $129 from May 2014. While that is a substantial increase, it's actually less than the 12.8 percent jump in February, and by year end the rental market is expected to slow to just 6 percent, according to Axiometrics, a real estate research firm. Some apartment communities have even begun offering concessions and discounts again, especially in areas of heavy construction. Nancy Burke, vice president of government affairs for the Apartment Association of Metro Denver cautions renters not to expect an overnight change. She believes it will be a year or two before the market fully stabilizes, but says things are moving int he right direction.
Buying a home in metro Denver may be a bit more challenging these days, but it is still possible to find your dream home with the right support. It's never been more important to have an experienced, locally-focused real estate agent to help you through the process. If you want to buy or sell a home in Colorado, contact us to learn more about how we can help.