The Denver real estate market could diverge in a big way in 2017, with apartment rental price increases plateauing or even decreasing, while home prices rising even higher.
Denver apartment market trends
A record number of new apartment communities means more vacancies and (potentially) falling rent prices or concessions for renters. But even steady prices means good news for a market that has seen double digit increases in the last few years.
According to Zillow, the media rental estimate for the Denver metro is $2,017 (no coincidence). This is more than $600 over the American average rental price of $1,411/month.
While Zillow doesn’t break down costs for average units in neighborhoods or with/without key amenities (in-unit washer/dryers, for example), those numbers seem fairly accurate for the large-scale, newer buildings coming to downtown and desirable neighborhoods.
Denver home price trends
In contrast, if too much supply is an issue with apartments, the opposite is true for Denver homes and condos, where new construction has failed to keep pace with gains in population and employment.
The median price of a home sold in Colorado last year rose 10 percent, with both new listings and the inventory of homes available for sale nearing historic lows. This news comes from the Colorado Association of Realtors.
This of course is a cautionary tale for renters. The low inventory, high demand and rising mortgage interest rates could drive more home searches back to apartments, boomeranging the rental market back to a more frenzied pace.
Best solution for home searchers
At the end of the day, we all need a safe place to lay our head. So, whether searching for a rental or a home the best advice is to plan early, evaluate all your options and stick to your budget.
Not sure what budget to keep in mind? Contact us for advice. We’re always here to help!