Should I buy a house in Denver? (Aurora, Broomfield: lease, mortgages)

[davebarnes]

Originally Posted by N610DL

Beyond that, in the last two years a lot of people left DEN for other cities so I think the housing market is in severe influx.

I will see your anecdotal statement of non-facts and raise you some data
2017 704,621 9,844 1.42%
2016 694,777 13,159 1.93%
2015 681,618 18,347 2.77%

[maciesmom]

Originally Posted by N610DL

...in the last two years a lot of people left DEN for other cities so I think the housing market is in severe influx.

"A lot of people"....lol

A lot of people also came or stayed here. Your point?

[N610DL]

Originally Posted by davebarnes

I will see your anecdotal statement of non-facts and raise you some data
2017 704,621 9,844 1.42%
2016 694,777 13,159 1.93%
2015 681,618 18,347 2.77%

Well there's also this: https://www.denverpost.com/2018/05/2...-redfin-study/

[bluescreen73]

Originally Posted by N610DL

Well there's also this: https://www.denverpost.com/2018/05/2...-redfin-study/

Yeah we already covered that article. Did you actually read it? There's no empirical evidence in it whatsoever. It's basically search data from Redfin. That's not the same as people actually leaving.

Here's a more recent article with links to some real data in it.

https://www.denverpost.com/2019/01/1...ination-in-us/

[JoePatterson12]

Originally Posted by sheerbliss

That's only $667 per month.

With any house, figure 1% per year for repairs and maintenance. Also figure that in the first few years of a mortgage, your payments are mostly interest.

Figure a 6% commission when you sell.

Property tax/HOA: 1% - $5,500
Insurance: $1500
Repairs: $1000?

Property tax/HOA could be as low as 0.5% so that's a conservative estimate.

6% commission is built into the 10% cost.

Good point about the mostly interest payments in first few years. Need to take that into account.

[sheerbliss]

Originally Posted by JoePatterson12

Property tax/HOA: 1% - $5,500

Repairs: $1000?
....

Good point about the mostly interest payments in first few years. Need to take that into account.

Maintenance and repairs will be on the low end if it's a new house. Otherwise, appliances, the furnace, the water heater, the roof, the plumbing, the paint, the landscaping, the flooring--it all takes upkeep and occasional replacement. My place here has come out to 1% of the value of the house per year; people still in Denver might be better able to say what they've averaged on repairs and maintenance there in relation to the value of their houses.

Interest is going to be your biggest expense.

[Timmyy]

Originally Posted by N610DL

This. I moved to Denver when I was 28 and moved away when I was 30 last year. Before I left, I considered buying a place (likely a condo) in Cap Hill solely for AirBNB and keep my furniture there before I moved back to Los Angeles.



Of course L.A. is way more expensive (so I didn't have the money for it) but depending on where you end up it's unreasonable to split up time to visit DEN for a house all the time. Think of all the maintenance issues relating to weather you'd have to fly out for and whatnot.


Beyond that, in the last two years a lot of people left DEN for other cities so I think the housing market is in severe influx.

In 2017 more people moved here then moved away. I have yet to hear the 2018 data.

The market here is far from "influx". The rental market has caught up but the inventory for homes for sale is low. If there is a nationwide recession then the market here will suffer.

The demand for homes is high so the values have risen. It is as simple as that.

[JoePatterson12]

Originally Posted by sheerbliss

Maintenance and repairs will be on the low end if it's a new house. Otherwise, appliances, the furnace, the water heater, the roof, the plumbing, the paint, the landscaping, the flooring--it all takes upkeep and occasional replacement. My place here has come out to 1% of the value of the house per year; people still in Denver might be better able to say what they've averaged on repairs and maintenance there in relation to the value of their houses.

Interest is going to be your biggest expense.

Thank you for that data point, good to have some sort of rule of thumb for older homes.

[WhatTheFox]

I would highly recommend buying if you have that kind of financial power. Especially since you're open to renting it out when you relocate out of Denver and not let the house become an anchor.

As for managing it, hire a property management company or purchase a warranty and call them when there is an issue. It's not like you'd have keep flying in to DEN every time your renter calls.

Denver is a regional powerhouse with no other major city (of its size) for hundreds of miles in every direction. Also, the mountains are a HUGE draw for people relocating to the Denver area and the Rockies aren't going anywhere. So your property will only appreciate long term. And true wealth in real estate is made long term so holding on to it is wise.

We can debate about stock market investments vs. real estate investments till the cows come home so I am not going there

[mic111]

Originally Posted by WhatTheFox

I would highly recommend buying if you have that kind of financial power. Especially since you're open to renting it out when you relocate out of Denver and not let the house become an anchor.

As for managing it, hire a property management company or purchase a warranty and call them when there is an issue. It's not like you'd have keep flying in to DEN every time your renter calls.

Denver is a regional powerhouse with no other major city (of its size) for hundreds of miles in every direction. Also, the mountains are a HUGE draw for people relocating to the Denver area and the Rockies aren't going anywhere. So your property will only appreciate long term. And true wealth in real estate is made long term so holding on to it is wise.

We can debate about stock market investments vs. real estate investments till the cows come home so I am not going there

This is an interesting and in my opinion good perspective. Originally I was going to post not to buy since you weren't staying for at least 5 years, preferably 7 or 10 which would make buying very safe as you can weather any drops. But as you further revealed you would just keep the house and rent it then that is similar to buying and living there longer. The only problem is if you panic sell if the market drops then you will lose money. I don't think Denver is going to hit the skids long term or in any serious way. We have a great diversified economy and are well known nationally as a great place to live. The only threat to us, that I can see, is a great environmental disaster brought on by fracking that lowers our desirability for new businesses and/or the great quality of life. But our state government is aware of the threat and is hopefully working against it.

So in summary, while I think your motivation for buying as an investment replacement is misguided, I don't think, given your stated goal of holding on and renting if you decide to move, you would be making a big mistake.

Edit: Forgot to add that you need to, at all times, have enough money to pay the deductible on your home owners policy to replace your roof due to hail damage. Almost 100% chance you will need to do this during the time you own the home. Also always get a place with a garage to save your car from hail damage.