Are you considering buying an investment but are unsure of where to invest? Are you wondering what the best locations in Colorado to invest in real estate? The Colorado housing market is a great place to purchase an investment property. Here are a few forecasts for 2020 that will help you to invest with confidence.
What was a performance like in 2018-19?
Generally, the great state of Colorado performs very well in the housing market. It has been ranked in the top 5 states for retirement, there is a trend towards population increase, and the market is steady. In the past five fiscal years, Colorado real estate has appreciated from 7-11%, each year.
This has shattered many previous records, and the average price of homes is now over $400k. Colorado boasts the lowest unemployment rate in the entire nation, which had a substantial positive impact on the housing market in 2019.
What were some noticeable trends in the past few years?
Both residential and commercial real estate sectors have been growing over the past few years. The unemployment rates are at 3%, under the national average of 3.8%. This means that local businesses require more employees, especially in the highly-skilled sector. With more hiring comes more rental properties and home purchases.
What were the most prosperous cities in 2018-19?
The mountain towns of Colorado saw an uptick of real estate purchases from residents of both California and Texas. Denver and Boulder remained the highest price areas with Fort Collins just behind them. There were many opportunities to be found in Airbnb type investments. Similarly, towns such as Pueblo, Colorado Springs, and Grand Junction continue their economic growth.
What is the Colorado housing forecast for 2020?
Overall, interest rates are expected to remain steady throughout most of the year. There has been some slowing of homes for sale, yet no one expects a downtown due to Colorado’s low unemployment rate. Many areas in Colorado remain popular places to live and work. If you are looking to invest in real estate, both short term and long term rental options are your best bets.
If you are looking for high priced investments, look towards the mountain towns. There is no shortage of short term or vacation rentals on the market. Finding a home to rent with a 6% or higher cap rate is the smartest option. Both of these investments will yield a long term appreciation.
What are some Changes to be aware of?
Even though the market has been steady and consistent, the housing prices are still flattening somewhat. For example, housing prices in metro Denver have slowed down due to the construction of apartments and condominiums.
In the next 12-18 months, you can expect to still see appreciation, just at a slightly slower rate. Any investment that you choose should still yield appreciation; don’t expect to cash out quickly in this market.
No one knows Colorado better than The Noel Team. Contact them at 303.774.9400 or email natalie(dotted)sjnoel(at)remax(dotted)net.
