Denver Real Estate Blog

The Denver Real Estate Investment Market

The wealth building power of real estate investing is a time-proven fact. So, why don’t more people invest in real estate, especially in a good investor market like we have in Denver now? Simply put: fear. Even though the market looks good for investors, taking the plunge can be nerve racking. Real estate provides investors with a tangible asset. Nobody can take your investment property from you on a whim. But stocks can plummet to zero.

Many people believe investing is risky. The truth is that investing, by definition, is not risky.

Investors don’t ignore risk; we mitigate risk by following sound principles and models. Buy property under terms that immediately create a profit. December and January are two of the best months to buy investment properties in Colorado. Some would call trying to rent a house in winter risky. But if you know how to do it right, risk is taken out of the equation.

Investing is about having sound criteria, the patience to find the right opportunity, and a willingness to take action. You can minimize risk while maximizing return.

Others believe successful investors are able to time the market. The truth is that in successful investing, the timing finds you. Timing is one of the most misunderstood concepts in investing. Many inexperienced people think investors are poised on the sidelines waiting for opportunities. The overall metro-area office market, according to Cushman & Wakefield predicts a 2007 vacancy rate of 13.1 percent, which is tighter than 2006’s year-end 15.1 percent. The company’s preliminary data show office rents averaging $20.23 per square foot market wide for the year, up from $18.70 last year. When business is strong the housing demand will soon follow.

“The truth is that timing is about being active,” says Jeffery McClintock, Broker and Owner of RealEstateColorado.Net, Inc . The best deals come from the best opportunities, and the best opportunities go fast. You must be constantly searching for opportunities that meet your criteria. When you find one, you must be prepared to act. Quickly. I once discovered a great real estate investment based on personal information gleaned from the seller, and walked into $30,000 in instant equity.

It is really only a myth that is all the good investments are taken. The truth is that every market, in every time, has its share of good investments. Two market forces create opportunities: economic and personal. They are always present and influencing the market.

Economic forces include job growth, interest rates, population shifts and area revitalization. Personal forces include opportunities from positive circumstances, such as relocation, marriage and family growth. Others arise from negative conditions such as divorce, debt and foreclosures. Almost anything taken as a whole can appear more complex than it really is. However, you don’t need to know everything in order to do something. Seek the knowledge you need to get in the game
“Many opportunities are out there to help people with their problems,” McClintock concludes. “Investors offer solutions. Our team is there to help.”

Many high-achieving investors have faced fears or doubts about investing that ultimately proved unfounded. These common “myth misunderstandings” can stand between you and true financial wealth.

Market Summary

Vacancies of rental single-family homes, condominiums, duplexes and other housing dropped to 3.9 percent in the third quarter from 6.4 percent for the same period of 2006. They were basically flat compared to the second quarter’s 4 percent average vacancy rate. The rental market in Denver is simply more attractive then the for sale market. Most people believe the market is going to decline and they are waiting for a really great deal right now. Those who subscribe to that way of thinking are not watching the market, but instead listening to the media hype. One good indicator as which way the residential market is going is to watch the commercial market.

The third-quarter’s 3.9 percent vacancy rate is the lowest recorded since the housing division launched its rental housing survey in 2001. Metro Denver has seen five consecutive quarters of vacancy drops in rental homes. Boulder and Broomfield counties reported the lowest vacancy rate at 2.3 percent, while Jefferson County had the highest rate at 4.6 percent.

Looking at types of homes, triplexes had the highest third-quarter vacancy rate at 7.8 percent, up from 6 percent for the same period last year. For-rent condos reported the lowest vacancies at 3.3 percent, down by more than half from 7.4 percent a year earlier.

Vacancy rates of less than 3 percent indicate a “very tight” market, according to the housing division. Vacancies of 5 percent are considered to be “equilibrium.” As vacancies dropped in the third quarter, monthly rents rose — to $967.29 on average from $957.28 in last year’s third period. Rents increased from $946.07 on average in the second quarter of 2007.

Average rents were highest in Douglas County ($1,380.43), and lowest in Denver County ($907.82). Rents increased the most in the Boulder/Broomfield area, to $1,361.25 from $1,202.80 for the same period last year. Rents averaged the following per month in metro other counties: Adams, $1,029.56 Arapahoe, $963.16 Jefferson, $938.47.

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Resource
A Colorado Rental Property Resource for both landlords and tenants can be found at http://www.coloradorentalproperty.net . Online land lords can post detailed information regarding their rental property, including 5 color photos. The ad can be self directed by the landlord to their cell phone or property management company. This is a service provided FREE by RealEstateColorado.Net and the ad will remain on line until it is asked to be removed.

REAL ESTATE

If you would like additional information about the Denver Real Estate area in Denver Colorado as well as anywhere in Denver Metro Area contact us at 1-800-791-3990 ext 232.

Jeffery McClintock, is a real estate broker in Denver and prides himself on providing clients with professional guidance in all phases of residential new construction, including market research, product development, consulting, marketing and advertising. His personal mission is to bring to you a level of knowledge, experience, commitment, high standards and results to answer your real estate needs. He believes, the most effective way to provide superior service is to build a strong working relationship with you. His system includes regular consultations and feedback, which is the best tool for identifying and clarifying your real estate objectives and help define strategic solutions.

Jeffery has been a licensed Realtor since 1995. During this time he has successfully closed over 135 million dollars of residential real estate, and 40 million dollars in un-improved land amounting to 660 individual real estate transactions. His professional experience includes the Denver Colorado front range and the Second Home market in Breckenridge, Colorado located in Summit County.