Quote:
Originally Posted by Stonemans_rowJ
Some interesting further reading on housing prices:
I was watching 9news the other night and another story about how expensive rents are. The local media jumps all over these stories because it really fires people up and "sells." Their data is from Zumper.
With Zumper, Zillow, etc. the data tends to be all over the place and can be very inaccurate. But its easy for news outlets to just take the easy headline. Like this story in the Denver Post, condo prices up nearly 20% in 2015. If that headline doesn't grab attention, I don't know what does. The reality is the only new condos that closed this year were in Cherry Creek at 150 Columbine. So of course those sales are going to skew the data. "Same store" sales would be nowhere close to 20% appreciation.
Great post about discerning the data here (from City Observatory)
And finally, Ken's post from Denver Infill on migration to Denver is wonderful. Long term demand looks strong.
However, best analysis of current apartment and rental trends here:
great potential for softening apartment market.
1-3 month concessions currently on luxury units
vacancy estimated to be in the 7-8% range
amount of new apartment construction coming onto the market may cause conditions to weaken during the fourth quarter of 2015 and into 2016. In conjunction with potential oversupply is a decline in the rate of growth in employment in metro Denver, creating less demand for apartments. Over the long term Denver remains an attractive market for apartment investment but it is important to be cautious about what market conditions may entail in 2016. |
Good reads, thanks for posting. Though I'm pretty sure James RE has been predicting a downturn in apartment construction for at least the last 2 years. I suppose they will be right eventually.
Another interesting note is that Denver/Boulder has among the lowest rental retention rates in the country, which to me means people are chasing concessions. I would think this would be an indicator that apartments are over-priced (duh) and some slowdown in both construction and rental rates may follow.
http://www.denverpost.com/business/ci_29139508/renters-denver-boulder-renew-leases-at-one-lowest
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