Predicting the future in any industry is a shaky practice. With real estate, things are still uncertain, but you can certainly see some trends that have affected the past six or seven years. The subprime mortgage crisis and subsequent foreclosures will affect you more or less, depending on which real estate market you are dabbling with.
Alan Greenspan, the seer of all things economic, saw the trouble brewing with the subprime mortgage industry back in 2000. Luckily for the Denver CO real estate market, the losses being felt elsewhere aren’t as severe for us here in the Rockies.
Why is this?
Home prices in Denver began tapering off back in 2000 and 2001, gradually ending the rampant home price increases of the 1990’s. Some markets like Las Vegas and certain places in California have yet to feel the full extent of their market correction based on the over inflated prices of their homes. Their pain is just beginning, especially as the jumbo loan market dries up.
For Denver’s neighborhoods that are priced below the median (the middle point between the lowest priced homes and the highest priced homes), values are declining- make no mistake. The more expensive neighborhoods are actually experiencing a rise in prices, even today!
Have I convinced you of the merits in Denver’s real estate market? Consider this: It costs nearly twenty percent less to live in Denver than it does to live in San Jose. It costs over ten percent less to live in Denver than it does in Seattle. Want to live in San Francisco? It will cost you twice as much to live in San Fran as it would to live in Denver. The same goes for New York. Boston? Denver is a quarter of the cost. And the list goes on and on.
Now, for people coming to live in Denver from the south and the Midwest, Denver might actually cost them more. Atlanta is pretty much a break even move as is Dallas and Minneapolis-St. Paul. But for people coming from Houston, Denver will be about ten percent more expensive.
You and I both know that move would be well worth the ten percent increase in living, now don’t we…
So the news isn’t all bad when it comes to the Denver CO real estate market. In fact, much of it is quite good, depending on your circumstances. Make sure you take the time to get informed on the Denver market and the different neighborhoods Denver has to offer. I know you will be glad you did!