Housing prices (Denver: rentals, condos, mortgages)

[hello-world]

Originally Posted by dj32

Jazzlover,

You may be right, I don't know firsthand Colorado's 80s real estate bust, however, I don't think we are in for an enormous crash simply because we did not see the obscene run up in prices like CA, NV, AZ, FL. Those markets were bound to crash, they were fueled by investors, flippers, etc... I feel bad for the people who bought at the top but I also feel like even the upper middle class couldn't afford a home in some of those markets, CA in particular. Denver saw an increase, some neighborhoods more than others, but nothing like that. People are saying that DEnver is already rebounding. I get nervous when i see the amount of high end construction in Denver neighborhoods, but i think the luxury market has been relatively stable.

What is more concerning to me than all of that is that the middle class seems hugely impacted by all of this, and that is what I find very sad. Between the offshoring of middle class jobs, fact that this segment of the population seems to be very stagnant in wages,etc.. is very depressing.

hope this post made some sense!

of course, denver/CO doesn't see salaries like you see in CA, NY, boston, etc either. so costs can only get so high, so salaries will only be so high, though all ramps with time it appears. seems to me many of those other places have been climbing for a long time, and salaries have had to try and tag along, so commerce can try and grab more, etc. the denver/CO climb has been relatively recent. i guess even the 80's boom/bust (lasting well into the 90s from what i understand) was somewhat recent, relatively.

[formercalifornian]

Originally Posted by dj32

...I don't think we are in for an enormous crash simply because we did not see the obscene run up in prices like CA, NV, AZ, FL. Those markets were bound to crash, they were fueled by investors, flippers, etc...

I think the most significant factor in whether or not the Denver real estate market is in trouble is not price, rather it is the number of homes funded with shaky financing. I live in a nearly new exurban neighborhood with moderate housing prices (~$250k), but a huge number of these houses were financed with exotic loans. As the two-year mark approaches, we are seeing a significant increase in foreclosures & short sales, which has reduced asking prices by about 15% so far and halted sales almost completely. Of course, this situation isn't the case everywhere in Denver, but it is scary for those of us watching it happen in our neighborhoods.

[hello-world]

Originally Posted by dj32

Jazzlover,

You may be right, I don't know firsthand Colorado's 80s real estate bust, however, I don't think we are in for an enormous crash simply because we did not see the obscene run up in prices like CA, NV, AZ, FL. Those markets were bound to crash, they were fueled by investors, flippers, etc... I feel bad for the people who bought at the top but I also feel like even the upper middle class couldn't afford a home in some of those markets, CA in particular. Denver saw an increase, some neighborhoods more than others, but nothing like that. People are saying that DEnver is already rebounding. I get nervous when i see the amount of high end construction in Denver neighborhoods, but i think the luxury market has been relatively stable.

What is more concerning to me than all of that is that the middle class seems hugely impacted by all of this, and that is what I find very sad. Between the offshoring of middle class jobs, fact that this segment of the population seems to be very stagnant in wages,etc.. is very depressing.

hope this post made some sense!

actually, it seems there have been plenty of investors and flippers in the denver area, as well as a TON of new building sprawling out from the city proper (and lots of lofts built within the city) - plenty of inventory (part of why prices didn't get as astronomical, i'd imagine - supply/demand). while denver does not see the prices of CA, boston, or NY, for example, the salaries are way less, too, as was discretion concerning lending practices (from what i read), hence part of why the denver metro's seen some of the "foreclosure epicenters" moving from community to community throughout the metro here, from what i can tell. but it probably is still cheaper around denver relative to salaries than in a NY, SF, or boston.

[Charles]

Originally Posted by hello-world

actually, it seems there have been plenty of investors and flippers in the denver area, as well as a TON of new building sprawling out from the city proper (and lots of lofts built within the city) - plenty of inventory (part of why prices didn't get as astronomical, i'd imagine - supply/demand). while denver does not see the prices of CA, boston, or NY, for example, the salaries are way less, too, as was discretion concerning lending practices (from what i read), hence part of why the denver metro's seen some of the "foreclosure epicenters" moving from community to community throughout the metro here, from what i can tell. but it probably is still cheaper around denver relative to salaries than in a NY, SF, or boston.

I'm am stealing this from a great post on the LA forum. Basically SoCal had a big run up in prices, a lot more than middle America. Not coincidently, there were many more wacky loans. Check out this graphic:



From this Wall Street Journal article:

The United States of Subprime - WSJ.com

Condensed in this post:

http://www.city-data.com/forum/1952875-post91.html

[hello-world]

Originally Posted by Charles

I'm am stealing this from a great post on the LA forum. Basically SoCal had a big run up in prices, a lot more than middle America. Not coincidently, there were many more wacky loans. Check out this graphic:



From this Wall Street Journal article:

The United States of Subprime - WSJ.com

Condensed in this post:

http://www.city-data.com/forum/1952875-post91.html

thanks. interesting map. looks like tings did inflate a lot along the I25 corridore (CO). it could be interesting to see a map of how salaries changed in the same time and foreclosures, inventory, high risk loans, etc. to get a better sense of relative situations.

[Charles]

Originally Posted by hello-world

of course, denver/CO doesn't see salaries like you see in CA, NY, boston, etc either. so costs can only get so high, so salaries will only be so high, though all ramps with time it appears. seems to me many of those other places have been climbing for a long time, and salaries have had to try and tag along, so commerce can try and grab more, etc. the denver/CO climb has been relatively recent. i guess even the 80's boom/bust (lasting well into the 90s from what i understand) was somewhat recent, relatively.

I don't think salaries in LA, NY, etc are even closely proportional to the housing costs there. Maybe for hot shot lawyers for hot shot clients or world class neurosurgeons (and of course commissioned realtors). But I doubt (haven't checked) that CPAs, plumbers, manufacturers, tool and die, truckers, health care workers, teachers, police, fire, etc. make double or triple in LA than they do in DEN.

Just one data point: A huge US aerospace company, really huge, pays exactly 6.8% more for engineers in LA than it does in COS, DEN, HOU, or HSV. I checked.

[wankel7]

Wait, what? Cheap rent in Denver? Coming from dallas real estate/rent is much higher than Dallas.

[Katarina Witt]

Originally Posted by Charles

I don't think salaries in LA, NY, etc are even closely proportional to the housing costs there. Maybe for hot shot lawyers for hot shot clients or world class neurosurgeons (and of course commissioned realtors). But I doubt (haven't checked) that CPAs, plumbers, manufacturers, tool and die, truckers, health care workers, teachers, police, fire, etc. make double or triple in LA than they do in DEN.

Just one data point: A huge US aerospace company, really huge, pays exactly 6.8% more for engineers in LA than it does in COS, DEN, HOU, or HSV. I checked.

Nurses seem to make a lot more in CA than CO. I have seen people quote salries of $40/hr which is about $10 - $15/hr more than here. In other words, $20,000 -$30,000 more.yr. There's a lot you can do with that much money.

[kristenfromdenver]

I think what happens is people are priced out of places like LA, San Francsico, Boston, New York and they look around Denver and move here due to it being a great place and more affordable. So, as the coasts fall, we rise.

[hello-world]

Originally Posted by Charles

I don't think salaries in LA, NY, etc are even closely proportional to the housing costs there. Maybe for hot shot lawyers for hot shot clients or world class neurosurgeons (and of course commissioned realtors). But I doubt (haven't checked) that CPAs, plumbers, manufacturers, tool and die, truckers, health care workers, teachers, police, fire, etc. make double or triple in LA than they do in DEN.

Just one data point: A huge US aerospace company, really huge, pays exactly 6.8% more for engineers in LA than it does in COS, DEN, HOU, or HSV. I checked.

wow. that is sad (the 6.8%). why would an aspiring aero engineer move there?

anyhow, my thinking is that, yes the housing markets are still disproportionate to salary in some places, but denver salaries seem rather lower than anywhere else i have lived (certainly any other metro the size of it)...but at a an angelean 6.8% premium, i'd be OUT of LA if the rest of life wasn't ABSOLUTELY peachy, for example.