Denver Real Estate Discussion / Opinion Thread (NO Data Charts) (Parker: homebuyer, inspection)

[ShampooBanana]

Originally Posted by SQL

As a homeowner, I am more than happy to see my home value go up.

But this reasoning seems absolutely ridiculous. Let me make sure I have this right. So, because builders haven't found a way to make home building profitable at a lower price point, buyers are forced to accommodate their bottom lines? I mean, if this is true, Denver is going to be screwed. We already had little affordable inventory to begin with. Now that they are building new homes, they're only building for the consumers who can afford $300k+. It's not like there is an infinite supply of $100k incomes living in this region.

As per usual, the entry level and lower earning participant is being lost and forgotten in this lovely economy we have. Welcome to the "luxury" economy, where basic living has been deemed a luxury by the powers that be.

Land is more expensive than ever. Development costs and labor are more expensive than ever. Buyer's expectations are higher than ever before as far as quality, interior finishes, floorplans, and energy efficiency. All of those things costs money plus builders still need to make a profit to stay in business. Add into the fact that new homes typically will command around a 10% premium over similar sized resale homes in the same location, and that is why very few homes in Denver at all can be had for under $300k, let alone new homes.


I'll also counter than income growth in Denver is pretty good compared to most places in the country. That's also helping to drive new home demand, not to mention the influx of people from places like the East Coast and California for whom Denver is still relatively affordable.

[Phil P]

To me, Denver is still not too bad if you have a decent salary and are renting a smaller place, but the gap between renting a small apartment and owning a home is big, to the point where I don't see it as worthwhile unless you plan on staying a good while, but even at a decent salary they are expensive.

To me, I'd rather risk my money in the market than risk it on a house here, where it requires a bigger investment chunk and is much less liquid.

[Coloradomom22]

Originally Posted by ShampooBanana

Land is more expensive than ever. Development costs and labor are more expensive than ever. Buyer's expectations are higher than ever before as far as quality, interior finishes, floorplans, and energy efficiency. All of those things costs money plus builders still need to make a profit to stay in business. Add into the fact that new homes typically will command around a 10% premium over similar sized resale homes in the same location, and that is why very few homes in Denver at all can be had for under $300k, let alone new homes.


I'll also counter than income growth in Denver is pretty good compared to most places in the country. That's also helping to drive new home demand, not to mention the influx of people from places like the East Coast and California for whom Denver is still relatively affordable.

I have heard people complain and even read a national article profiling a local man who wants to downsize but can't find anything smaller (yet newer) in his price range. The fact is that even when builders make smaller homes they are not much less money than homes with a lot more square footage. Gone are the days when you could sell your house and buy a smaller but newer/nicer ranch style house for your senior years for the same money or less.

[2bindenver]

Blame building codes and the building science - it costs more from land to development to materials to labor to marketing and sales.

[vegaspilgrim]

Originally Posted by 2bindenver

Blame building codes and the building science - it costs more from land to development to materials to labor to marketing and sales.

I notice there are a bunch of new construction home developments in Colorado Springs that offer smaller yet attractive (1200-1500 sq ft) ranch homes. Why is it they sell those kinds of homes there but hardly any in the Denver area?

[emm74]

Originally Posted by vegaspilgrim

I notice there are a bunch of new construction home developments in Colorado Springs that offer smaller yet attractive (1200-1500 sq ft) ranch homes. Why is it they sell those kinds of homes there but hardly any in the Denver area?

The median home price in COS is half that of Denver. They can build luxury ranch homes, charge more than the median price but not too much and make a nice profit but going much larger and more expensive could be a tough sell in a lower priced market.

In Denver, they've be leaving money on the table to build houses that small and below the median price. For instance, in Stapleton, given how small the lots are, on the same amount of land, they could build two 750K (and up) houses or three 350K small houses. If you were a builder, which would you choose? And actually, saying you could build 3 small houses could be pushing it since a ranch could have about the same size footprint as a two story with a finished basement and 3 times the square footage.

[SQL]

Originally Posted by vegaspilgrim

I notice there are a bunch of new construction home developments in Colorado Springs that offer smaller yet attractive (1200-1500 sq ft) ranch homes. Why is it they sell those kinds of homes there but hardly any in the Denver area?

It always boils down to $$$.

Furthermore, (on the demand-side) I think people here are willing to live exceptionally house-poor lifestyles to have the newest and biggest house on the block. I know a few newly-minted homeowners (usually young couples) who are buying brand 5BR+/3BA+ homes out in Arvada and Golden for around half a millions dollars. Why two people (and an infant in some cases) need that much space, I don't know. Not to mention that it's a huge drain on our environment to keep sprawling outwards with all these McMansion developments. But these people don't seem to mind. So I suspect that'll continue driving the upward trend in housing sizes/prices.

[davebarnes]

Homeowner Happiness Index | A Research Study by HomeAdvisor

Colorado

According to HomeAdvisor's new Homeowner Happiness Index, which found that homeowners in Denver are the third-happiest in the nation.

[guyatwork37]

Originally Posted by davebarnes

Homeowner Happiness Index | A Research Study by HomeAdvisor

Colorado

According to HomeAdvisor's new Homeowner Happiness Index, which found that homeowners in Denver are the third-happiest in the nation.

Yeah, that's what happens when you live in a nice place that's relatively affordable to other major cities.

[skins_fan82]

Hey folks. Quick questions. Our friends have been in their new construction home in Parker for exactly one year to the day, yesterday. They live in Sierra Ridge (Southwest corner of Linclon & Chambers in Parker).

With a chance to completely pay off their student loans, they are looking to sell. Like, now. They're already in talks with a realtor. The base price of the home model they built is now about $80K more than what they paid 18 months ago (when they signed on to build), and they have a lot of upgrades.

Thing is, they'll be looking to build again in another year or so (no particular builder, just in Parker). Do you guys think home prices will continue to grow over the next year? Or will things finally settle down and level off next summer?

My buddy was telling me that he's a bit worried about home prices possibly being so much more by this time next year (Meritage Homes is already charging $80K more for his house now than they did when he built in 2015), that it won't even be worth it to sell.

Any thoughts? Thanks in advance