By Neil Goradia
The Denver housing market has repeatedly made national news over the past decade, setting records in real estate price appreciation. People continue to flock to the Mile High City—and many other parts of Colorado—because of our great attractions and ample job opportunities.
Denver is at the doorstep of the magnificent Rocky Mountains. It’s home to the Colorado Rockies baseball team, the Denver Zoo, the Denver International Airport (an attraction in and of itself), and countless large national and international companies. Corporate players like Amazon continue to expand their presence in our city. These have all played a role in Denver’s rapid ascension.
If you’re in other rapidly-growing areas like Maricopa County, Ariz., Salt Lake City, Utah, or the Houston-The Woodlands-Sugar Land metropolitan area, you can probably relate.
I like to describe Denver as a “Tier 1” real estate market. This self-proclaimed ranking system is very subjective. However, my real estate friends and I include such measures as cost of living, home prices, neighborhood desirability (where buyer competition is especially high), and comparisons to other markets.
As a real estate investor, I have been based in Denver buying houses for almost two decades. In this time, I have witnessed Denver graduate from a sleepy town—where travelers once bedded down on their way to the west coast—to a burgeoning metropolis, often in the same conversations as larger real estate markets like San Francisco and New York.
My associates and I have a prediction about Colorado as a whole, that we’ve been discussing for some time: We believe the state will double in population by 2040.
So, why are people flocking to the Centennial State? Why is Denver such an attractive place to live? Is it because property values are rising and more people want to buy here?
The answer to these questions is: Not really.
The house price increase is the proverbial chicken or the egg scenario (if, of course, you believe the egg came first…).
I believe there is a much greater force at play that’s calling people to the Mile High City, which is, in turn, fueling the real estate appreciation.
I believe there has been a fundamental shift in how people in America perceive the American Dream.
No longer is it simply owning a house with a white picket fence. Now, the American Dream means buying a home in a neighborhood or city that provides access to a desired lifestyle.
And, if you’re like me, you know Denver, Colorado has plenty of that!
Denver is home to a wide array of restaurants, shops, and nightlife. You don’t have to look much further than the downtown districts LoDo and RiNo to witness this explosion.
Denver has lifestyle in spades! Colorado embodies the great outdoors—and the city has easy access to it. Denver is on the front range, at the base of the mighty Colorado Rockies, with bounds of outdoor experiences just waiting for explorers.
The greater Colorado region has skiing, mountain biking, fishing, hunting, hiking, biking, festivals, and even beaches. Yes, the water may be cold in the Colorado River, but beaches are still there.
Lifestyle opportunities abound, and people throughout the country are increasingly becoming aware of this—and they want in.
As a real estate professional, it’s important to understand what’s drawing people to your market, how that migration is affecting real estate prices, and for how long that lure may last.
Of course, it involves the simple law of supply and demand. As the demand increases, so too will real estate prices.
But the supply of houses has been historically low for many years in Denver. This has been exacerbated by the global pandemic and the skyrocketing prices of building materials. The increase in costs has made it difficult for builders to build new homes and therefore added pressure to the supply—or lack thereof.
Our clients want a way of life, but we are not building enough new homes. Can you relate to this in your market? These are the clear reasons why the home prices in Denver—and several other U.S. markets attracting lifestyle buyers—will continue to increase for years to come.
Neil Goradia is the founder of Go Indy Real Estate in Indianapolis. In addition to being an agent, he has a background in fix and flips, land development, and private lending. Connect with him on Facebook.