Denver Real Estate Blog

Historical Housing Statistics for Colorado

Single Family Units
Year Units Sold Change Median Price Change
2006 77, 342     -8%       $233,471      3%
2005 84,103       4%       $227,071     10%
2004 80,918     10%       $206,649       4%
2003 73,372       3%       $198,879       2%
2002 71,314       2%       $194,853     15%
2001 69,666       5%       $170,000     21%
2000 66,452     15%       $140,047      9%
1999 57,995      6%        $128,812      2%
1998 54,622     -4%        $126,250     -2%
1997 56,909      2%        $129,432     -5%
1996 55,638    14%        $136,578     25%
1995 48,891    -6%         $108,906     11%
1994 51,746                   $98,036

Condos/Townhomes
Year Units Sold Change Median Price Change
2006 19,291        -11%     $190,743   26%
2005 21,755           3%     $151,667     1%
2004 21,118           9%     $150,114  -13%
2003 19,321           0%     $172,500     5%
2002 19,328          -1%     $164,667     5%
2001 19,433          14%    $156,477    22%
2000 17,006          15%    $128,758    19%
1999 14,724           4%     $108,333    13%
1998 14,148          -7%     $96,250    -16%
1997 15,209           7%     $114,370     6%
1996 14,258         12%     $107,700    24%
1995 12,766           6%     $86,875     20%
1994 12,073                     $72,106

Residential Rental 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.

Resource for Rentals

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 thier 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.

Denver “New-home” prices are following a nationwide trend

The sub-prime market meltdown is hitting home builders in the Denver area harder than anytime since the 1980s, when the economy collapsed in the wake of an oil and gas bust. Some experts predict we will probably see new home sales off 50 percent at the end of this year, compared with 2005. By comparison, we saw about a 20 percent decline after (the terrorist attacks) on 9/11. This downturn this time is different from the one two decades ago.

Despite good economic news on almost every other front - the Denver area’s resale homes showed the highest month-over-month increase in value in August compared with 19 other cities - there are signs the new-home market is struggling. Some builders are expected to declare bankruptcy or flee Colorado before the market recovers. The latest example is the recent bankruptcy filing by Neumann Homes, a builder with a presence in Denver.

In the 1980s, the area suffered from an economic crash after dramatic growth on rising gas prices. Denver and Colorado companies that invested in the boom collapsed when prices dropped to about $12 a barrel. In the Denver area, a record number of homes, apartments and condos were built to prepare for the growth that never came. Instead, tens of thousands of people fled Colorado for better economies in places such as California, often walking away from their mortgages, leading to foreclosure levels that only now are being toppled. Colorado, Oklahoma, Louisiana and Texas were hit the hardest.

This go-round, there’s an unprecedented crash in housing prices nationwide. Denver-based MDC Holdings, one of the nation’s largest home builders and parent of Richmond American Homes, has cut its work force by about 40 percent since 2006 and recently reported a $155.4 million loss in the third quarter. The loss came after years of reporting record quarterly profits. MDC Chairman Larry Mizel described the market as being in “turbulent times” in a recent Securities and Exchange filing.

Residential Real Estate Market

You’ve seen and heard the news; home mortgage delinquencies and foreclosures are on the rise – in some areas to record levels. And while I wish I could assure you that the bad news is over, mortgage delinquencies and foreclosures are likely to continue well into 2008. That is almost guaranteed, given anticipated interest-rate resets on subprime adjustable loans. Those overly aggressive — and even reckless — lenders who completely mispriced risk deservedly need to be weaned out of the market. There is no such thing as high-yielding easy money. There is no such thing as a free lunch. High yields always come with dicey RISK!

When will the housing market get back on its feet? Imminently! There is a large pent-up demand accumulating that will be unleashed in a short matter of time – our best estimate is early 2008. Consider this year’s conditions versus that in 2005, the peak housing year. Home sales have already fallen by 1.5 million since 2005. Even if all the 1.4 million subprime mortgage originations were to disappear — which no one expects — then the bottom has already been reached in terms of any impact from tightening credit standards. In reality the level of subprime lending activity could be reduced by half at most, implying that the declines in home sales have been far greater than any tightening of lending availability. The additional decline in home sales can be attributed to other factors outside of the subprime loan disruptions. Is it jobs? A resounding NO. Is it due to lack of income and wealth? Another resounding NO. Is it due to higher home prices? NO. Is it due to higher mortgage rates? Surely some impact, but the rates are only modestly higher. What’s the explanation then?

The primary reason seems to be a lack of confidence. Constant reminders in the media of how “bad” the housing sector is has eaten into buyer confidence. However, that decision to put off buying a home comes with an “opportunity cost”. Apartment vacancy rates have been declining and rents have been rising by 4.5 percent in the second quarter of 2007, the highest increase in five years. People have also been doubling-up by having additional roommates or moving back “home” with parents, as evidenced by a drastic slowing in household formation. Familiarity will inevitably breed contempt in close living quarters. It is only a matter of time before people begin to form their own households.

Locally, home sales are forecasted to rise 10% in 2007 and then make another rise of 5% in 2008. Home prices will be flat in 2007 and then increase 4% to 6% in 2008. With all the subprime problems out of the way by 2009, the momentum will inevitably strengthen further.

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Real Estate Source

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.