Here's a look at the latest Colorado real estate trends and news.
There was another uptick in home prices.
The S&P/Case-Shiller national home price index jumped higher yet again, marking a 4.7 percent year-over-year increase in July. Denver saw a 10.3 percent increase since this time last year and remains among the cities posting the highest year-over-year price gains.
Nerd Wallet compared the Case-Schiller numbers with U.S. real median income from the U.S. Census Bureau to demonstrate whether housing is more or less affordable (the higher the number, the more affordable). The index currently stands at 53.44, meaning homes are the least affordable they have been since November 2006.
Demand & lifestyle choices are driving the upward trend.
Demand for homes is increasing faster than supply, pushing rents and housing prices up. Low vacancies and low inventory indicate this is a trend that will continue. One reason is the shifting lifestyle choices of today’s consumer. Many young adults, 20-35, are getting married and starting families later, choosing instead to live in urban areas. Meanwhile, many older adults are moving from single family homes to apartments. Both are causing an increase in housing demand in urban centers and affecting prices.
Mortgage rates may increase in 2016.
Mortgage rates have been favorable to consumers for awhile not. However, at the end of September, Freddie Mac issued a housing market prediction for 2016. The company’s chief economist forecasted that the average rate for a 30-year fixed home loan would gradually rise to 4.2 percent by the end of this year, and 5.1 percent by the end of 2016. This increase could cause a slight reduction in home buying, but it's really too soon to tell. To be safe, consider locking in your mortgage at today’s low rates as soon as you get a closing date.
Metro Denver (and beyond) is growing and changing.
Metro Denver currently has the highest population growth rate in the country—1.6 percent. That translates to 1,000 new people a month. Driving through once rundown or undeveloped neighborhoods, running errands, or trying to get dinner reservations, long-time residents can notice the difference.
Since 2013, 13,000 new units have been built in an effort to accommodate the influx, but it's not quite fast enough. Other construction projects, like new office buildings and grocery stores, are also popping up. And the growth is not just confined to metro Denver. Even Denver suburbs are becoming more urbanized. Greeley, Colorado, once just a small farm town, recently reached 100,000 residents and has added loft-style apartments over shops and restaurants to attract the next generation of homebuyers looking for urban living.
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.