Real Estate News: Investing in Colorado Properties
It is very transparent that rental prices in Colorado has been rising including south metro cities. We have been seeing fewer units that are available and more people who are willing to pay high rental prices.
Two of the main reasons for an increase in rental demand are millennials and baby boomers. Millennials from out-of-state are flocking to Colorado for the outdoor, liberal lifestyles and job opportunities. Baby boomers are retiring and looking to downsize.
Young people who are just starting out find themselves facing the challenge of purchasing a home because of a lack of down payment, marrying later in life or not being able to find a job. Developers looking to build multifamily projects stress that millennials want the flexibility that renting affords.
Baby boomers on the other hand prefer to rent in a walkable neighborhood and most importantly, maintenance-free housing. Paying rent isn’t ideal but paying taxes to own a house after retirement is less ideal.
Apartment rents are up at least 5 percent in most metro-area cities since summer 2014, but there is no shortage of people willing to pay. In south metro-area communities, renters and those still looking for a place are faced with some of the highest rates in the state.
According to apartmentlist.com, the average one-bedroom is going for more than $1,000 a month in most places. For two bedrooms, it’s generally around $1,500 or more.
The vacancy rate in the metro area is 4.5 percent as of June 2015, according to the Metro Denver Economic Development Corporation and the U.S. Census Bureau reports that the national average is about 7 percent.
Despite the high rental rates, it is more important to be mentally prepared to purchase a home rather than diving into a home purchase because of media headlines. There are plenty of resources that can provide great information on how to purchase a home – especially for millennials – who don’t know where to start.
It’s never too early to understand your options and each neighborhood has different average price points.
Feel free to contact me if you have any questions on the housing market, buying or selling, and if you would like to compare market trends in different neighborhoods.