Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
What you don't seem to understand is that the market dictates the price. I'm baffled how many people just don't seem to grasp this concept. If our real estate market was overpriced, people wouldn't be paying it and people wouldn't be flocking to Denver in droves. Another fact is that there are PLENTY of single family homes under 300K in the Denver Metro area, they just aren't up to the standards of people moving here. Heck, there are plenty of houses under 200K in the Denver area, but people moving here want the large, updated, move in ready 4 bedroom house. So, what are developers building? Updated, move in ready 4 bedroom homes. Housing is not a charity and from the sound of it, some of you want it to be. There are zero obligations by any business to purposely lose out on potential profit just because some people think they are too expensive. I'd love a new Mercedes, but they are too expensive for my budget. Should Mercedes come out with a model that I can afford just because I think their other cars are too expensive? The answer is no. I buy what I can for my budget which means I might be buying a Hyundai which won't have all the bells and whistles that the Mercedes would have. In the real estate market, that means I buy a much smaller home in the area I want which also might require some work, or I move further out and commute into the city.
This is accurate.
However it is also important to keep in mind why prices are high. In Denver's case, it is because of economic boom and lack of inventory. This *could* be an issue down the road once the economy slows down, or if inventory catches up to the demand. My fear is that homeowners will want to keep their values, and would vote against certain changes in order to keep their home values high. I can see a lot of people buying in say...Cap Hill for 750K+ complaining once the market stabilizes, or if the neighborhood keeps building apartment complexes around them (easing demand).
I understand I have no say in this...but I just cannot see how a 550 square foot town home in Wash Park will remain around 1 Million in the next 5 to 10 years. Sure, it's not going to bust to like 250K or anything, but a price like that just cannot sustain itself once Denver cools off. It's also an issue as many home buyers are buying properties as investments, and looking for short term returns in just a few years. I imagine most people who buy these tiny lots for anything over 750K are investors looking for a quick buck.
What you don't seem to understand is that the market dictates the price. I'm baffled how many people just don't seem to grasp this concept. If our real estate market was overpriced, people wouldn't be paying it and people wouldn't be flocking to Denver in droves. Another fact is that there are PLENTY of single family homes under 300K in the Denver Metro area, they just aren't up to the standards of people moving here. Heck, there are plenty of houses under 200K in the Denver area, but people moving here want the large, updated, move in ready 4 bedroom house. So, what are developers building? Updated, move in ready 4 bedroom homes. Housing is not a charity and from the sound of it, some of you want it to be. There are zero obligations by any business to purposely lose out on potential profit just because some people think they are too expensive. I'd love a new Mercedes, but they are too expensive for my budget. Should Mercedes come out with a model that I can afford just because I think their other cars are too expensive? The answer is no. I buy what I can for my budget which means I might be buying a Hyundai which won't have all the bells and whistles that the Mercedes would have. In the real estate market, that means I buy a much smaller home in the area I want which also might require some work, or I move further out and commute into the city.
So you're comparing luxury sedans to basic housing needs? I don't understand that comparison.
There are plenty of people who would like to afford a basic SFH/condo/townhome or basic apartment, without all the "luxury" amenities built into the price. But there just aren't many available on the market, and not many are being built. And this forces people to unwillingly bunk up with several room/house mates so they can afford to live close to where they work or where their family lives.
There's also the idea that people are buying more house than they should or can afford, while foregoing the allocation of funds into retirement/savings/etc. This is known as being house poor. But, as we all know, that's never happened in the history of civilization, and the housing market has always been a gold mine that has never went bust.
However it is also important to keep in mind why prices are high. In Denver's case, it is because of economic boom and lack on inventory. This *could* be an issue down the road once the economy slows down, or if inventory catches up to the demand. My fear is that homeowners will want to keep their values, and would vote against certain changes in order to keep their home values high. I can see a lot of people buying in say...Cap Hill for 750K+ complaining once the market stabilizes, or if the neighborhood keeps building apartment complexes around them (easing demand).
I understand I have no say in this...but I just cannot see how a 550 square foot town home in Wash Park will remain around 1 Million in the next 5 to 10 years. Sure, it's not going to bust to like 250K or anything, but a price like that just cannot sustain itself once Denver cools off. It's also an issue as many home buyers are buying properties as investments, and looking for short term returns in just a few years. I imagine most people who buy these tiny lots for anything over 750K are investors looking for a quick buck.
Well put. People are so short-sighted and they always seem to forget that markets are cyclical and that nothing stays hot forever. It's as if we constantly need 2008 housing crises to remind us of this. Your last paragraph is on point and it's exactly how many people are viewing the housing market here. When I was shopping last year, there were SO MANY developers buying up properties so they could scrape or flip.
So you're comparing luxury sedans to basic housing needs? I don't understand that comparison.
There are plenty of people who would like to afford a basic SFH/condo/townhome or basic apartment, without all the "luxury" amenities built into the price. But there just aren't many available on the market, and not many are being built. And this forces people to unwillingly bunk up with several room/house mates so they can afford to live close to where they work or where their family lives.
There's also the idea that people are buying more house than they should or can afford, while foregoing the allocation of funds into retirement/savings/etc. This is known as being house poor. But, as we all know, that's never happened in the history of civilization, and the housing market has always been a gold mine that has never went bust.
The problem is that people's "basic housing needs" are no longer 4 walls and a roof. It is 4 walls, a NEW roof, granite countertops, remodeled bathrooms, etc.. Developers are giving the market what people are requesting. That's what I'm getting at with the analogy that obviously 747ed itself right over your head. People don't want the Hyundai, they want the Mercedes.
Check this out which can be bought for 180K, but let me guess the excuses. Needs work, too far of a commute, too small, isn't updated, blah, blah, blah.
Being 'house poor' is a choice. Again, it goes back to the new definition of basic housing needs. Why spend 200K for 4 walls and a roof (which, again, there are plenty of houses out there in this range)when you can spend 400K for 4 walls and a roof with, granite everything all the while trying to keep up with the Jones. It has nothing to do with a salary versus COL, it has everything to do with people being idiots. But also, I have no stats, just as you don't, as to how many households are truly house poor. Just as I'm sure you have personal examples of people being house poor, I have plenty of examples where people are buying 500K homes and are FAR from house poor because they have great jobs and are paid a great salary.
I completely agree with your point, but what you'll hear are: "bad schools, air smells like burned oil and/or sewage, Commerce City, industrial, blah blah."
To keep it real, the only people buying this^ are Hispanic families or investors. Urban pioneers haven't reached CC yet.
The problem is that people's "basic housing needs" are no longer 4 walls and a roof. It is 4 walls, a NEW roof, granite countertops, remodeled bathrooms, etc.. Developers are giving the market what people are requesting. That's what I'm getting at with the analogy that obviously 747ed itself right over your head. People don't want the Hyundai, they want the Mercedes.
Check this out which can be bought for 180K, but let me guess the excuses. Needs work, too far of a commute, too small, isn't updated, blah, blah, blah.
Being 'house poor' is a choice. Again, it goes back to the new definition of basic housing needs. Why spend 200K for 4 walls and a roof (which, again, there are plenty of houses out there in this range)when you can spend 400K for 4 walls and a roof with, granite everything all the while trying to keep up with the Jones. It has nothing to do with a salary versus COL, it has everything to do with people being idiots. But also, I have no stats, just as you don't, as to how many households are truly house poor. Just as I'm sure you have personal examples of people being house poor, I have plenty of examples where people are buying 500K homes and are FAR from house poor because they have great jobs and are paid a great salary.
Both of those houses are nice, and I would have no opposition to buying that type of house. Even the proximity from Denver is not bad at all IMO. However, I'm sure they are cheaper than market because they are located in one of the most polluted and (literally) smelliest areas in the entire metro. I've rode my bike through that area several times (along the Platte) and it smells like sewage and industrial burn-off. If you can get over that, they seem like decent places. The fact that they're asking for close to $200k for those places kind of baffles me actually. But that's pretty much the Denver RE market in a nutshell. Pay ~$200k to live in a highly polluted and smelly area.
This one is a trailer. Anybody who buys this for that price is out of their mind.
I completely agree with your point, but what you'll hear are: "bad schools, air smells like burned oil and/or sewage, Commerce City, industrial, blah blah."
To keep it real, the only people buying this^ are Hispanic families or investors. Urban pioneers haven't reached CC yet.
The one near the Platte is surely going to have the stench problem for most people. I've rode my bike in that area a lot, and it doesn't surprise me that it's also one of the least crowded bike paths in the city. It can be difficult to breathe over there, especially when the weather is hotter and the air is thick. Pardon me, but I could understand why someone might have an issue with that considering health is of the utmost concern for many people in Denver.
This one is a trailer. Anybody who buys this for that price is out of their mind.
I completely agree with your point, but what you'll hear are: "bad schools, air smells like burned oil and/or sewage, Commerce City, industrial, blah blah."
To keep it real, the only people buying this^ are Hispanic families or investors. Urban pioneers haven't reached CC yet.
The point is that a lot of people on this forum seem to think that the only houses for sale are 400K and up which just isn't true. They just don't like the houses that are in their price range, so they complain that prices are too high.
The point is that a lot of people on this forum seem to think that the only houses for sale are 400K and up which just isn't true. They just don't like the houses that are in their price range, so they complain that prices are too high.
You've literally picked the worst examples to justify your opinion though. You've basically acknowledged, by way of your examples, that you need to live in a dump (or near one) to find an affordable SFH in Denver.
Heck, I think I could have found better examples than that. From what I've gathered, most are going to be condos in that under-200k range. I have no qualms with that. I actually bought a 2BR/2BA condo last summer for under $200k. I would love to have a small SFH (2-3BR/1-2BA), but the majority of those are in $250k+, and I just didn't want to spend that while being single. Once my GF and I become more serious and possibly tie the knot down the road, we will start to consider those types of houses, if necessary. I actually really like my condo though, and the location.
You've literally picked the worst examples to justify your opinion though
So, you admit that there are decent houses out there for 200K and that people don't need to buy a 400K home?
Something else people don't seem to factor in with the cost of homes in Colorado is that our property taxes and homeowners insurance are relatively low when compared to a lot of other states. This tends to give people more purchasing power because they are looking at the monthly payment. With varying tax rates throughout the country, this could swing a mortgage payment by well over 300 a month. Just look at some of the tax rates in Texas where housing cost is a lot cheaper than Colorado.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
