Those reports about a cool-down in the nation’s red-hot real estate market? Not now, not here in Denver.
Home-price appreciation is slowing in most big cities in the U.S. But Denver shows no signs yet of easing away from double-digit rates of increase.
According to housing researcher RealtyTrac, metro Denver home prices are rising at an annual rate of 12 percent — up from last year’s increase of 9 percent.
That makes Denver an exception to the national trend of slowing rates of price increases. RealtyTrac said two-thirds of the nation’s 92 largest metropolitan areas are showing smaller appreciation growth this year compared with last year.
Colorado Springs also is bucking the trend with prices rising at an 11 percent annual rate vs. 4 percent last year.
Still unknown is the effect that low oil prices may have on the Colorado economy. Energy companies are cutting back on drilling and hiring, but economists say it’s too early to tell whether the pullbacks will have a measurable impact on housing and other economic measures.
Meantime, Colorado’s real estate market is being driven by job gains, and population increases running twice as high as the national average.
But the state’s healthy economic performance has pushed demand for homes higher than supplies. The resulting price increases have created an affordability crisis in both for-sale and rental housing.
The number of metro Denver homes on the market hit a modern-era low of 4,079 in February, according to the Denver Metro Association of Realtors.
“I have never seen such a limited inventory in the Denver market,” said real estate agent KiKi Cannon with Coldwell Banker Residential. “We have less than a month’s supply of homes on the market.”
Homes priced under $400,000 are routinely generating multiple offers, Cannon said. That may seem an attractive scenario for sellers — until the sellers must enter the market and compete for a replacement home.
“As year-over-year housing prices continue to increase, home affordability is going to become a greater issue as the entry point for first-time buyers grows higher and higher,” said Anthony Rael, chairman of the Denver Realtors market trends committee.
Steve Raabe: 303-954-1948, sraabe@denverpost.com or twitter.com/steveraabedp
