Denver Real Estate Bubble Not In Single Family Houses

Dated: April 6 2016

Views: 343

Denver's single-family housing market, with some of the strongest home-price appreciation and fastest turnover times in the country, often gets pegged as a bubble in the making.Zillow research director Krishna Rao argues that those looking for a bubble should instead focus on metro Denver's multifamily rental market.A decade ago, Denver-area builders requested about 15,500 permits per year for single-family homes. 

After the crash, the number of permits averaged only 6,000 a year, although it has since moved closer to 10,000 a year, still below historical averages.By contrast, more than 31,000 multifamily permits have been pulled the past four years, a record-setting pace.And new units are expected to keep hitting the market even though more supply means landlords are being forced to dial back on rent increases and provide heftier concessions.

Strong in-migration, especially among young adults more likely to rent apartments, justified the emphasis on apartment construction, Rao said in his analysis.Denver County had the sixth largest increase in population of any county last year with 500,000 or more residents. It ranked eighth when it came to population growth tied to people relocating from other states, according to a New geography analysis of recently released U.S. Census Bureau numbers.

Image title


The shift away from ownership to renting after the housing bust also justified more multifamily. Renters, who were 47.5 percent of all households in 2010 in metro Denver, now represent 51.9 percent of the total, according to Zillow.But Rao argues that too much multifamily inventory is hitting the market too fast, pushing up vacancy rates and driving down rents. 

He said oversupply will only get worse, given the long times needed to plan and complete apartments."Taken together, all of this suggests that while demand so far has been sufficient to absorb those units that have already come online, it may be stretched to accommodate the tens of thousands of units builders are planning to deliver over the coming years," Rao said.



Denver Colorado Real Estate Professional
 -Michael Steffen

Michael is a motivated realtor specializing with investors and new home buyers located in the following areas; DenverArvada,Aurora and surrounding areas. Michael Steffen uses advanced internet marketing to insure your property gets maximum exposure and holds a high value of ethics in his work to ensure the ideal scenario for everyone! For help with buying or selling a property call 303-981-2750!

eNewsletter Sign Up

Blog author image

Generation Property Group

My name is Michael Ross Steffen. I’m an Exit Realty Cherry Creek Agent in the Denver metro area and Team Leader For Generation Property Group! We specialize in advanced Internet marketing, buying, s....

Latest Blog Posts

Should I Sell My Home in the Winter???

Is selling your home in the Winter a good idea? With interest rates keeping consitently low, buyers are more inclinded to buy reguardless of the season. Most people think the best time to sell is

Read More

Get Those Bugs Off My Tree!!!!!

One of the best parts about Christmas at Generation Property Group is going on the hunt for the perfect LIVE Christmas tree.We have the best memories of strapping a tree to the top of our subaru and

Read More

Who doesn't love Christmas Lights?!

One thing we've learned about 2020 is to be creative with activties! While a lot has changed in our daily lives, we have used our creativity to plan healthy and safe things to do while social

Read More

Make Ahead Thanksgiving Recipes!

We know 2020 has been a CRAZY year! Here are some easy make ahead Thanksgiving recipies to help make this year's Thanksgiving a little less crazy! Test out one of these RECIEPIES in your new Denver

Read More