The Denver Metro Real Estate Market
Currently the Denver Metro Real Estate Market is seeing a 15.26 increase in appreciation year over year. Whether you are looking for a single family home or a condo, it is a strong sellers market. At the end of March we had a total of 1,926 properties on the market in the Denver Metro area, hitting historic lows. To give some perspective we had 27,309 properties on the market in 2006. From 1985 to 2020 the average amount of listings that were on the market was 14,250 (although we have not seen a number that high in many years). Median price of a single family home in Denver Metro rose to 485k and the average price rose to 565k.
Is new construction the answer to our property shortages? Probably not, most builders have a waiting list now with hundreds of buyers looking to secure a lot. Building supplies are hard to come by and the costs continue to increase. This brings up the question “Are we in a real estate bubble?” If you look to simple supply and demand the answer is no. Keep in mind real estate may be different from state to state, city to city and real estate markets depend on localized circumstances. Some states are losing residents on regular basis offering very little in terms of appreciation. This is not the case in Denver, we have a current annual population growth rate of 1.48%.
Whether you are buying a home below the median sales price or you are buying a property in the luxury market we are having a hard time keeping up with buyer demand. Although interest rates are ticking up I doubt we will see much relief as our demand continues to be high and our supply continues to be at all time lows. We now have more Realtors in the metro area than we have properties. It is more important than ever to find an experienced Realtor that knows how to navigate these tumultuous waters.
Long-term rental licenses for Denver landlords approved by City Council committee
The Denver City Council Business Committee just approved a rental licensing policy program that would require landlords to pay for long-term licenses to rent out their properties.
Advocates of the bill say that by requiring the long-term licenses, the “Healthy Residential Rentals for All” program intends to improve the conditions of rental properties, track the cities housing inventory and will establish better communications between tenants and landlords. But, will that be the result? Not according to proponents of the bill who believe our basic fundamental private property rights are at stake. This bill would be the largest expansion of required licensing in the city’s history according to Eric Escudero, spokesman for the city’s Department of Excise and Licensing. Stacie Gilmore the creator of the measure said it would take years and hundreds of thousands of dollars to launch and that they still do not know what the ongoing costs would be. She argues it’s necessary to protect tenants, ensure landlords meet basic standards and collect basic contact information from landlords. However, proponents and housing advocates worry Denver’s rents will only rise with the possibility that landlords will pass the costs along to tenants. Landlords are concerned about costs and making their private information publicly available.
Applications in Denver would cost $50 and the cost of licenses would range from $50 for single-unit properties to $500 for multi-family properties with more than 250 units. Landlords would have to hold licenses for parcels not individual rentals. However, this makes the cost for the individual investor much more expensive than for the institutional investor.
Gilmore tis modeling this bill after a similar program in Boulder, CO. licenses in Denver would need to be renewed every 4 years. Gilmore said that Inspections would also be required and that landlords would have to hire private inspectors on their own dime in-order to cut down on the city’s workload. She also mentioned that officials could fine landlords that don’t meet housing standards and suspend or revoke licenses, although tenants would be able to stay through the end of their lease. This could possibly lead to new landlord bankruptcies dictated by the city of Denver.
Proponents fear safety violations found during inspections would count against landlords even if they were caused by tenants. They also point out that most likely cost will be passed on to the tenants making rents even more expensive.
Will we see a bill funding legal representation for Denver renters who are facing eviction? One group of tenants’ advocates has filed a ballot initiative to fund legal representation for Denver renters facing eviction, two city council members plan to introduce a similar proposal through the legislative process. Councilwomen Candi CdeBaca and Amanda Sawyer solicited feedback at a virtual town hall meeting back in beginning of April. Under the initiative, taxes would increase by approximately $12 million annually through a $75 assessment imposed on landlords for each residential unit for lease. In exchange, the city would institute a program to provide legal representation to all tenants facing eviction.
Looks like major changes are coming down the road for Denver landlords.
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