denver economy (real estate market, construction, prices)

[movin' on up]

what impact will the looming recession (so say the experts) have on the denver economy? i haven't moved to denver yet (plan to this summer) and i'm curious about the way that the city deals with this type of thing. i've read that denver has wild peaks and valleys, aka "a boom or bust" economy. presumably this will impact the job and housing markets. anyone have thoughts? what's happened in the past, say the tech bust in late 2001?

[Mike from back east]

Well, you've come to a place where ALL the experts reside...

See these links:
- The Adams Group - Colorado Economy
- The Denver Post - Economist predicts downturn in '07 or '08
- The Chance of a recession by the end of 2008

[2bindenver]

What do you think will happen?

My crystal ball is broken. And I can't find one on ebay to replace it.

[tfox]

Denver has historically had wide booms and busts as befits a city that has always been dependent on resource extraction. It's part of our history, and I don't see it changing. Though in modern times we've seen the IT and telecommunications sectors come here, those industries too are cyclical.

Despite what some on this board say, my personal opinion is that Denver will come out of this recession okay, at least on a relative basis. For once, I think our dependence on resource extraction (mining, energy) actually helps mitigate the fallout in the national economy, as the prices of those commodities won't come down significantly even with a recession (due to continued demand from China). As our regional neighbors like WY, MT, UT, NV are also heavily dependent on resources, I think that will buffer us from the sour national economy. Our new mainstay, telecommunications is actually coming out of a long slump from 2001-2004, so I'd say it will continue a rebound despite the headwinds of recession.

Also, despite what is commonly believed, Metro Denver's real estate market has been sluggish for many years (except perhaps in pockets), even while much of the rest of the country was booming. There has not been a lot of speculation here for many years, and construction in the metro area has really sowed since the 1990s. Consequently, I don't see the current correction in real estate has having a primary impact on our economy, as it would in other places like Florida or AZ. Commercial Construction is still fairly strong, and I think that commericial has largely picked up the slack from residential from a jobs perspective. Residential prices here will probably flatten or slip for a few years, but I don't see it as affecting all that many jobs here.

Take it with a grain of salt, since I'm no economist.