Colorado's Hot Home Prices Tap The Brakes, But Just For Winter
Northern Colorado's home and condo prices are not ticking up quite as fast as they were earlier in 2015. But the lull is typical heading into winter, say real estate experts.
If you look year over year, the median single family home price of $304,000 for the Northeast Region, which covers Boulder, Larimer, Logan, Morgan and Weld counties, is still nearly 15 percent higher than the $265,000 it was at this time in 2014.
Prices for townhomes and condos market are also staying up. With a median price of $225,000 in the Northeast Region, the prices for these units are 19 percent higher versus the same time in 2014.
Kelly Moye, with the Colorado Association of Realtors, called the recent price plateau a "seasonal shift." Hiring typically slows this time of year, meaning fewer people moving into the region. In 2016, however, Moye said most people watching the market expects it to pick back up.
"Everybody that I've talked to seems to think next year  is going to be equally as strong as this year. We have economic factors in our state that all point to continued growth and continued appreciation," said Moye.
This is especially true because the inventory of homes is not growing quickly. Builders are trying to fill the gap in supply that is contributing to higher prices, but they are not able to build at a rate that keeps up with demand, said Moye. This is particularly true for construction of homes priced below $300,000.
Since the Colorado economy is continuing to remain strong, growth in the state will likely continue, keeping the market busy.
"We should probably see a similar really brisk spring next year," said Moye.
It's not only Northern Colorado experiencing very fast growth in prices. The Denver Metro region, which includes Denver suburbs, is on the same track. The median single family home price in the Denver Metro in October 2015 was $344,000, up 14 percent from this time in the previous year.
Such prices may not seem unusual for workers moving from higher-priced coastal areas, but Colorado's Front Range has historically had a lower cost of living. Wages are typically lower than they are on the coasts, and that disparity between home prices and income contributes to a rising lack of affordability.
At a recent demography meeting in Littleton, Jason Schrock, a chief economist with the office of state planning and budgeting,said that home price increases in the Northern Front Range were increasing faster than any other part of the country except coastal cities.
"Really only the coastal areas of the country have higher costs than the Northern Front Range," said Schrock.