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Old 04-10-2017, 04:57 PM
 
Location: Arvada, CO
13,707 posts, read 26,371,458 times
Reputation: 13867

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Quote:
Originally Posted by wilberry View Post
Denver

$70,741 salary needed

$386,800 home price

$1,651 monthly mortgage

so where do the lowly un master degreed in STEM live .... oh yeah Sterling, Limon, etc....
Or Arvada. I dropped out of college at least 3 times. My wife dropped out of high school. We bought in 2014, and our mortgage is about exactly that.
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Old 04-12-2017, 07:13 AM
 
Location: Somewhere in Colorado
154 posts, read 119,724 times
Reputation: 324
Quote:
Originally Posted by wilberry View Post
Denver

$70,741 salary needed

$386,800 home price

$1,651 monthly mortgage

so where do the lowly un master degreed in STEM live .... oh yeah Sterling, Limon, etc....
You could do Aurora for that.
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Old 04-13-2017, 08:28 AM
 
3,273 posts, read 1,737,756 times
Reputation: 2458
Quote:
Originally Posted by wilberry View Post
Denver

$70,741 salary needed

$386,800 home price

$1,651 monthly mortgage

so where do the lowly un master degreed in STEM live .... oh yeah Sterling, Limon, etc....
This is completely unsustainable.

When you charge someone $1,651 for rent on a 70K salary, they will barely have any discretionary income for anything else, particularly when you factor in things like utilities, health insurance, auto insurance, etc.

This is one of the reasons why retail is not doing well, which is putting tremendous pressure on commercial real estate. When you take money out of one sector of the economy, particularly when the economy is predicated on services, it has a ripple affect on other sectors.

I would not want to be a landlord right now in Denver, particularly if you are highly leveraged and are currently purchasing homes.

Imagine if an "oil shock" occurred now. People don't seem to realize that this is one big set up.
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Old 04-13-2017, 09:02 AM
 
Location: Denver
1,330 posts, read 537,079 times
Reputation: 1269
Quote:
Originally Posted by Jobster View Post
This is completely unsustainable.

When you charge someone $1,651 for rent on a 70K salary, they will barely have any discretionary income for anything else, particularly when you factor in things like utilities, health insurance, auto insurance, etc.

This is one of the reasons why retail is not doing well, which is putting tremendous pressure on commercial real estate. When you take money out of one sector of the economy, particularly when the economy is predicated on services, it has a ripple affect on other sectors.

I would not want to be a landlord right now in Denver, particularly if you are highly leveraged and are currently purchasing homes.

Imagine if an "oil shock" occurred now. People don't seem to realize that this is one big set up.
$1650 isn't that bad. You figure that a 2br apartment is 13-1400, it's not significantly more, plus you get $1-200/ month back at the end of the year in tax breaks from interest.
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Old 04-13-2017, 09:14 AM
 
3,273 posts, read 1,737,756 times
Reputation: 2458
Quote:
Originally Posted by illinoisphotographer View Post
$1650 isn't that bad. You figure that a 2br apartment is 13-1400, it's not significantly more, plus you get $1-200/ month back at the end of the year in tax breaks from interest.
You're not factoring in uncertainty. For example, IOCs are no longer investing in long term projects, which historically has resulted in a supply shortage and proceeding "oil shock."

If an oil shock occurs today, game over. Everybody selling at once, which results in a massive drop in prices because there will be no buyers.

People are too complacent and short-sighted. This is not going to end well. I can't predict when it will end, but it will not end well.
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Old 04-13-2017, 10:07 AM
 
Location: Denver
1,330 posts, read 537,079 times
Reputation: 1269
Quote:
Originally Posted by Jobster View Post
You're not factoring in uncertainty. For example, IOCs are no longer investing in long term projects, which historically has resulted in a supply shortage and proceeding "oil shock."

If an oil shock occurs today, game over. Everybody selling at once, which results in a massive drop in prices because there will be no buyers.

People are too complacent and short-sighted. This is not going to end well. I can't predict when it will end, but it will not end well.
I have no idea what you're talking about.

Denver's economy isn't highly based on oil, and if the price of oil drops, homes aren't going to drop in value.

There are over a hundred thousand new people to the area each year. There's no shortage of buyers for the limited housing stock we have. Will it keep increasing at 10%/year like the last 3-5 years? No. I'd bet it levels off in the next year or two. We're already seeing a lot of homes fall out of contract due to appraisal prices not coming in and sellers being greedy. But I can see the entry level houses being at the $340-350k mark and staying there.
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Old 04-13-2017, 10:24 AM
 
Location: Denver, CO
760 posts, read 685,698 times
Reputation: 1494
It really depends on supply. If all those new neighborhoods out East get built, which I think right now were looking at about 180,000+ new SFHs, all while the downtown construction goes live, and all while a nation wide recession hits, price will come down...even it's just 5-10%.

There's a big difference between crash and correction. As a non expert of the industry, I'm on team correction.
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Old 04-13-2017, 10:30 AM
 
Location: In The Thin Air
12,572 posts, read 9,060,665 times
Reputation: 9226
Quote:
Originally Posted by MN_Ski View Post
It really depends on supply. If all those new neighborhoods out East get built, which I think right now were looking at about 180,000+ new SFHs, all while the downtown construction goes live, and all while a nation wide recession hits, price will come down...even it's just 5-10%.

There's a big difference between crash and correction. As a non expert of the industry, I'm on team correction.
I agree. If they over build that will definitely slow the rising of values or halt them altogether. I wish I had a crystal ball. We shall see. I like seeing the city grow though. Makes me feel a part of something bigger.
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Old 04-13-2017, 10:33 AM
 
132 posts, read 101,977 times
Reputation: 225
Quote:
Originally Posted by Jobster View Post
You're not factoring in uncertainty. For example, IOCs are no longer investing in long term projects, which historically has resulted in a supply shortage and proceeding "oil shock."

If an oil shock occurs today, game over. Everybody selling at once, which results in a massive drop in prices because there will be no buyers.

People are too complacent and short-sighted. This is not going to end well. I can't predict when it will end, but it will not end well.
The "Oil Shock" your talking about wrecks California not Colorado. Public transportation/Rail is actually a viable option here as opposed to whatever LA is offering up these days.
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Old 04-13-2017, 10:39 AM
 
Location: Denver
1,330 posts, read 537,079 times
Reputation: 1269
Quote:
Originally Posted by MN_Ski View Post
It really depends on supply. If all those new neighborhoods out East get built, which I think right now were looking at about 180,000+ new SFHs, all while the downtown construction goes live, and all while a nation wide recession hits, price will come down...even it's just 5-10%.

There's a big difference between crash and correction. As a non expert of the industry, I'm on team correction.
I think there will still be a premium and larger demand for homes west of I25 though within the 470 loop. Although you can get a lot more for your $$ out in Aurora, Castle Rock or Roxborough (south of Chatfield), being within a short drive of the mountains and still having public transportation options will most likely keep those home values up.

It's not too different than any other large city though. Chicago (where I'm from) has a lot of desirable towns that command premium pricing whereas other towns a few miles down values can be significantly less, even for newer construction. I just don't see your Littleton's, Golden's and Boulder's coming down much in pricing due to homes in Aurora being built.
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