Over the course of the past several months, Denver has seen its real estate increase in value. Home prices have increased along with buyer activity and the city has experienced one of the most encouraging housing market improvements since before the subprime mortgage crisis. While a number of interrelated factors have contributed to this value increase, the following characteristics have been some of the most influential in the recent trends.
One of the biggest, if most abstract, contributors to the changing home prices and real estate values in Denver has been the recent shift in the economy. After several years of increasing unemployment rates, plummeting stocks and decreased credit ratings, the country’s overall financial standing has finally seen an upswing. Most importantly, employment rates are on the rise, providing people with the funds necessary to put a down payment on a home.
Confidence in the Market
Consumer behavior in general has also contributed to the increase in the value of Denver real estate. In other words, the recent economic recovery has not only resulted from an increased number of jobs or more company revenue, but also from heightened consumer activity. Encouraged by positive trends, individuals have begun to invest more money into the economy by buying up more stocks and purchasing more products. This activity has been infectious and has extended to the real estate market which has seen the results of enhanced consumer enthusiasm.
After the housing market crash in 2008, hundreds of home building projects were suspended or cancelled. As a result, the overall inventory of houses in the country has remained stagnant for the past several years. While this did not present immediate consequences, the recent economic improvements have put an increased number of individuals in the market for a new home. As a result, demand is up while supply is still down — a surefire way to increase home prices and the overall value of Denver real estate.
Increases in Rent
Another reason that consumer demand for real estate has increased is because rent prices have also been on the rise. Previously, individuals had opted to rent rather than buy in order to save money, but because the recent economic improvements have also affected rental companies, monthly rent costs have also increased. In fact, some rent prices are nearly equal to monthly mortgage payments. As consumers have begun to realize this, they have expressed more interest in purchasing a home, leading to the elevated value of real estate in Denver.
While economists and real estate professionals are still hesitant to be overly exuberant about the housing market, the improvements in the real estate sector are undeniable. Many property owners, banks and real estate companies are coming to realize this as well, and as a result, home prices and interest rates have been steadily increasing in recent months. Thus, if you’re in the market for a new home, now may be one of the best times to buy.
Call Mark Hunke today for a free home valuation.