Denver a Bargain? Check out the link to these Studios In New York City

Yes, it is a fact Denver is not inexpensive; some statistics advise Denver is the most expensive city concerning real-estate not on a coast line. Now, granted, 1/2 the population of the United States lives within 50 miles of a coastline but not wanting to split hairs.

With that advised, the following is a fascinating read:

New York City’s Priciest Studio Apartments

With the prices quoted, trust me I can find you some truly spectacular options in Denver and the suburbs. Granted I may not be able to provide the 24 hr. doorman however I’ll throw in a video entry system.

BTW: the studio pictured above is 23′ by 9.5′ or approx 218 SF the size of a typical cruise ship cabin. While even small by NYC standards, would be considered living large in Hong Kong.

Millennials and the Housing Market

As an experienced real estate broker I have always been intrigued by the those entering the marketplace. The Millennials (those born between the early 1980′ and the early 2000’s) are now in the marketplace for their first home as well as step-up.

At the same time, the Baby Boomers i.e. those born between 1946 and 1964 are in the process of transitioning to smaller, less maintenance dependent options as some are becoming or are empty-nesters and similar. Just look at the explosive growth of the Cherry Creek neighborhood.

Upon reviewing some industry news I came across the following statistics:

  • At present, almost 60% of the population is under the age of 55.
  • 66%+ of Primary Home Equity is owned by those over the age of 55.
  • Of the 66% noted above, 52% of them have no mortgage i.e. their homes are free and clear.
  • For those under age 55 who own a home, only 19% own their homes free and clear.

While the above should not be striking  as older folks have been in their homes longer and have experienced record equity appreciation (even when factoring in the recent recession), yet there is concern on the horizon.

Will the next generation be able to afford the homes of their parents i.e. the Baby Boomers? 

Will there be a dramatic shift in housing styles towards multifamily and other more affordable options?

While development will continue in exurban areas providing affordability will our next generation of buyers remain in the city and close-in suburbs trading affordability for convenience?

What I have noticed since the great recession is an appreciation for Denver’s inner-city neighborhoods. While the old adage will always be true it’s is all about Location, Location, Location we are witnessing Millennials change the housing landscape by gentrifying close-in neighborhoods, rejecting the notion one must be in a single-family detached home and more recently the willingness to rent in lieu of purchase even with interest rates at historic lows.

Concerning Denver I am not overly concerned as we continue to be in a healthy growth cycle, demand continues to outpace supply and in reality while not inexpensive, when compared to the coasts coupled with the lifestyle, Denver is still quite affordable with the average single-family home in the metro-area running about $300,000.

While I am not reading the tea-leaves the next decade may bring changes to the housing market. As real estate brokers, developers and investors we need to keep an eye on the millennials and their tastes and desires. As the Baby Boomers consider selling and downsizing they will have excess equity to spend i.e. vacation home, travel, investments yet will the Millennials be in line to purchase their homes and prevailing prices? And if interest rates continue to rise, the inverse may happen to housing prices, what then?

Just some commentary for conversation by the water cooler.

 

 

Most Expensive Rentals in Denver

Well, its semi-official, downtown adjacent Golden Triangle neighborhood is the most expensive neighborhood on average for a one-bedroom rental with a median (half were higher, half were lower) of $2,275/month in October 2015 according to San Francisco based Zumper, an apartment rental search and application app.

What is interesting is this is a neighborhood which has transformed immensely over the past two decades. While always home to the Denver Art Museum on the south-side of Civic Center (and of course the Burnham Hoyt/Michael Graves Denver Public Library), the area boomed when luxury condos were built between Lincoln Street and Speer Boulevard from 7th Avenue to 14th Avenue. In addition, the area welcomes the Clyfford Still Museum, a few unique mixed use projects and of course a central location.

Yet historically the mid-rises east of Lincoln Street have historically offered affordable rentals north and west of the Governors Park neighborhood  as well as across Cherry Creek at Parkway Center.

If you have driven northbound on Speer Boulevard you will see new luxury rentals sprouting up along this historic street. At the intersection of 6th/Speer what was once a large gas station has given way to a mid-rise new development as has a lot to the northwest beyond Broadway.

For additional details, here is a link to the article in the Denver Business Journal