Metro Denver home prices appreciated 8 to 12 percent last year, continuing to outstrip the national average, wage gains and the overall rate of inflation for the fifth year in a row.
The average price of a home sold in metro Denver crossed the $400,000 mark in November, while the median price was around $350,000, according to the Denver Metro Association of Realtors.
Despite higher prices, the inventory of homes available for sale remained constricted throughout the year and new lending disclosure rules and a shortage of appraisers stretched out closing times.
Home price gains have run so high for so long they have started to weigh heavily on affordability, especially for first-time buyers.
Denver City Council responded by passing the city’s first ever affordable housing fund, which is looking to raise $150 million over 10 years from higher property taxes and developer impact fees.
Home builders are adding only a fraction of the single-family homes needed given population growth and job gains, and condo construction remains depressed after yet another failed attempt in the legislature to loosen the state’s construction defects rules.
But developers have added apartments at a healthy clip, and that has provided some relief for renters. Apartment rent increases, running in the double digits in the summer of 2015, slowed to under 2 percent this fall, the smallest gain since 2010.
Looking ahead, a big supply of new apartments and slower population growth should keep rents down, even if developers stay focused on high-end units.
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