The U.S. housing market in 2021 has been a year full of low interest rates, eager buyers and low inventory of homes on the market. Denver is no exception, especially as it continues to attract young professionals, growing families and others to its location on the Front Range of the Rocky Mountains.
Ranking No. 14 among the Best Places to Live in the U.S. in 2021-2022, Denver sees high scores for its desirability among U.S. residents and strong job market in particular. But such attractions that draw people to the Mile High City and its surrounding suburbs come at a cost: The more popular Denver gets, the more expensive the housing. And it’s only getting more popular.
The Denver Market Now
Is It a Buyer’s Market or Seller’s Market in Denver Right Now?
The Denver housing market is currently experiencing a seller’s market, meaning there are more active buyers than there are homes for sale. As a result, sellers benefit from competition among buyers, which means homes often sell for above the asking price and sell quickly.
Denver Home Prices
The median home price for single-family detached homes in the Denver metro area was $600,000 in July, according to the Denver Metro Association of Realtors. Adding in attached properties, the median close price for homes was $540,000.
The median home sale price for single-family detached homes is the same as in June and less than $8,000 above May, though it’s a 20% increase compared to July 2020. Factoring in attached properties as well, the median close price is a slight drop from the month prior, but up 17.39% year over year.
Denver Foreclosure Rate
The Colorado Department of Local Affairs reports that in the first quarter of 2021, the most recent data set available, the entire state of Colorado saw 226 foreclosure filings and 103 sales at auction, which are completed foreclosures. Compared to the first quarter of 2020, foreclosure filings are down more than 83% and completed foreclosures are down more than 66%.
A major factor impacting foreclosures for much of 2020 and into 2021 was the fact that the U.S. Department of Housing & Urban Development instituted a foreclosure moratorium for any federally backed mortgages as a result of the COVID-19 pandemic. That protection expired on July 31, so it’s likely foreclosures will climb in the coming months in the Denver area, the state of Colorado and across the rest of the U.S.
Renting in Denver
At the start of the pandemic in 2020, interest in rentals saw a marked drop in major U.S. cities as people sought lower density and more space to comfortably quarantine and work from home. Denver was no exception, though by late summer 2020 rents were beginning to recover.
A year later, rents have continued to climb in large cities, and in Denver it’s no exception. The median rent in the Denver metro area is $1,866 as of July, a 12.9% increase compared to July 2020, according to realtor.com.
“The recovery this summer mirrors what we’re seeing nationally,” says George Ratiu, senior economist for realtor.com. “From the trough of 2020, we’ve seen all markets see a strong recovery.”
The rentals seeing the most interest also tell a typical pandemic tale — larger rentals are rising in price faster than smaller units. Two-bedroom units had a median rent of $2,175 in July, an increase of more than 15% year over year, while studio apartments had a median rent of $1,548 in July, just a 9% increase year over year, according to realtor.com data.
Homebuilding in Denver
Homebuilding in the Denver metro area is a much-needed aspect of the local housing market. While people moving to the area has slowed over the years, population growth has continuously led to increasing demand on housing and pressure for additional housing options. Between 2015 and 2019, the Denver metro area increased in population by 3.88% due to net migration alone, according to the U.S. Census Bureau.
“The Denver area has been on a rapid growth trajectory ever since the Great Recession ended, and that has created a counterintuitive dynamic where everyone seems to agree on the need for more housing, but actually building the housing the community needs is more difficult than ever,” wrote Stephen Myers, chief operating officer of Thrive Home Building, a local homebuilder in the Denver metro area focused on health and energy efficiency, in an email.
