Why Denver Real Estate Has Changed So Much Since the Great Recession
It’s been over a decade since the Great Recession of 2008, and fortunately most of the country has recovered. But with home values having increased more than 44% since the recession, the word “recover” is an understatement here in Denver.
The Great Recession’s effect on Denver
As a quick refresher, let’s talk about how the Great Recession affected real estate from 2007 to 2009. During this time, the U.S. housing bubble burst and kicked off a global financial crisis. Toxic mortgage lending, excessive borrowing by consumers and corporations, and the bankruptcy of Lehman Brothers were major contributing factors to the Great Recession.
Pre-recession, in 2007, home values in the greater Denver area reached about $291,000. From 2007 to 2009, those values decreased to about $263,000 on average. While the rest of the country has reached about 86% of their pre-recession home prices, Denver was one of the fastest in the country to bounce back. In fact, Denver was the first city to eclipse average housing values from 2007 by June 2013. On top of that, the Denver-Aurora-Lakewood metro area has exceeded its pre-recession average home values by 127%! Statistics show that the average price for a single family home in Denver has hit a record high of $625,000 in October of 2020.
Denver isn’t the only hot spot in Colorado to rebound quickly from the recession, either. They may have taken longer, but home prices in Denver suburbs like Lakewood and metro areas like Colorado Springs have exceeded pre-recession values as well.
Denver’s strong and growing economy
Following the Great Recession, Denver’s economy recovered well — the best out of ten major cities in the United States, in fact. A study from SmartAsset considered factors like unemployment, income growth, poverty rate, and more to examine which cities bounced back, and Denver came out on top.
From 2010 to 2016, Denver’s unemployment rate decreased from 11.9 percent to 4.3 percent. The poverty rate decreased by 7.9 percent in the same time period, the largest decrease for any city. Plus, the population has grown 14 percent since 2010. Home values rose 44.3 percent since the recession.
Of course, those numbers don’t take the recent coronavirus pandemic into account. Though the road to recovery in terms of job growth and unemployment will be long, as it will for everyone, there’s good news. Colorado’s economy is doing better than the national average, which is a positive sign for current Coloradans and those thinking of moving to Colorado.
Low supply and rising house prices in Colorado
A strong and growing economy plus population growth leads to high demand for housing, which Denver has experienced in the last decade. Trendiness plays a role, too: Colorado was the third most popular state for millennials in 2015, after Texas and Washington. Seen as a cool place to live, Denver attracted even more newcomers who were looking to buy homes and settle down in a new city.
Another factor that has driven up house prices since 2008? Low vacancy rates, leading to a lower supply of new homes. Out of the 75 largest metro areas in the United States, Denver-Aurora-Lakewood consistently had some of the lowest year-round vacancy rates from 2015 to 2018. People come to Denver and its surrounding neighborhoods with the intent to stay.
The future of Denver real estate
What can we expect to see in the future for Denver’s housing market? In Colorado overall, we predict that the 2021 Denver real estate market will continue to be competitive and in high demand. New homes get snapped up fast by homebuyers in Denver and the surrounding metro areas, despite the uncertain economic future the pandemic has brought.
That’s why now is a great time to invest in a new townhome in a desirable neighborhood. West Line Village is a brand new, transit-oriented community of townhomes anchored between downtown Denver and the mountains. At West Line Village, you can easily commute to the office and head into nature to relax. And if you’re working from home, our energy-efficient layout includes a flex room that’s perfect for your home office space.
Don’t miss out on a new townhome in West Line Village. Take a virtual live tour of a townhome today, or make an in-person appointment by calling or texting 303-912-0606. Contact West Line Village today for more information!