Denver and three other metropolitan areas were ranked among the 20 “healthiest” by Builder magazine, a trade journal for the home building industry.
Colorado has more metropolitan areas on the list than any other state.
Twice a year, “Builder works with Hanley Wood Market Intelligence to compile a list of the healthiest housing markets in the United States, based on forward projections for the metrics that drive housing production–jobs, price appreciation, population growth, and income growth,” according to the article. “The projections come from Moody’s Economy.com,.”
A national spotlight on the state’s housing market is great, said Jan Nelsen, a broker with Kentwood City Properties.
“I think it speaks to our quality of life,” Nelsen said. “A lot of people want to live here. And our inventory is so low that we are actually seeing more than one person interested in the same house these days.”
However, she said it probably over-stating it to say that bidding wars are occurring.
“I wouldn’t call them ‘wars,’ Nelsen said. “People are very cautious about over-paying. Some people will just bow out if the price starts to rise.”
For her, Nelsen said the “sweet spot” is in the $400,000 to $600,000 range.
Hilltop and Mayfair are experiencing a lot of activity, she said, and homes are selling in Cherry Creek, as sellers become more realistic what they can get in this market.
“More homes are selling in the $900,000s in Cherry Creek,” she said. “A lot of times sellers are taking a loss, but they’re selling them. For a lot of buyers, it’s important to get homes below $1 million – that is kind of their comfort level,” even for well-heeled home shoppers.
“And of course, Highland is as hot as ever,” Nelsen said. “We’re seeing pre-sales of homes in Highland before they are even completed.”
Following is a list of the top Colorado cities, according to Builder.
Rank: No. 2.
AreaL Fort Collins-Loveland
Health Index: 89.4
2010 Population Forecast: 299,630
2011 Total Building Permit Forecast: 1,004
2012 Total Building Permit Forecast: 1,650
Comments: The word is out about Fort Collins, which is regularly ranked among the best places to live in the country. Moody’s projects that the number of households in Colorado’s fourth most populous metro region will grow a hefty 2.7 percent next year, the highest on our top 20 list.
Many new residents will be drawn by the prospect of jobs. Employment is projected to grow 2.6 percent next year, lifting median incomes 3.3 percent. Colorado State University is the biggest employer here. Most of the new jobs in recent years have come from the education and health services sectors. But high-tech firms such as Hewlett Packard and Eastman Kodak also employ thousands of people.
Housing production will receive a boost from these strong demographic forces. Moody’s projects that permit levels will rise 50 percent.
Rank: No. 7
Area: Colorado Springs
Health Index: 80.9
2011 Population Forecast: 642,200
2011 Total Building Permit Forecast: 2,099
2012 Total Building Permit Forecast: 3,639
Comments: There is light at the end of the housing market tunnel in Colorado Springs. The three biggest employers here, by far, are military bases, and the fourth biggest is the Air Force Academy. The return of troops from Afghanistan may further stimulate the housing market.
Moody’s expects housing metrics to be up across the board in 2012, with home prices climbing 2.6 percent, employment rising 1.4 percent, households increasing 1.8 percent, and median incomes rising a hefty 2.9 percent.
The market has thrown off mixed signals this year. Existing home sales were up 12 percent year over year in July. Unsold housing inventory has been dropping and the foreclosure situation is improving. But median home prices fell 5.2 percent in the year that ended in July.
Rank: No. 10
Health Index: 76.7
2011 Population Forecast: 2,611,500
2011 Total Building Permit Forecast: 3,801
2012 Total Building Permit Forecast: 7,548
Comments: A housing recovery is blooming in Denver, where permit activity is expected to nearly double in 2012. Decent job growth–the metro area is on a pace to add 20,000 jobs this year–will contribute to strong income growth of 3.6% next year. Chase Bank, PricewaterhouseCoopers, and New York Life all recently announced new hiring plans here.
Denver dealt early with the foreclosure crisis and has had a significant decline in new foreclosure filings this year. That’s helped keep home prices pretty stable here, even during the housing recession. 2011′s median price, $223,100, is only $20,000 below 2006 levels.
Multifamily construction is on the rise in Denver, which can now boast of a vibrant downtown district. Vacancy rates on downtown apartments have dipped below 3%. Also, the city’s public transit system, FasTracks, continues to expand, creating new development opportunities all over town.
Rank: No. 20
Health Index: 72
2010 Population Forecast: 252,825
2011 Total Building Permit Forecast: 1,532
2012 Total Building Permit Forecast: 2,510
Comments: The forces lifting the housing market along Colorado’s ‘s Front Range are spilling into Greeley, located about an hour’s drive northwest of Denver.. Home prices here never got out of control during the housing boom and reset early in the housing recession. Also, the region dealt early and effectively with its foreclosure situation.
Now, positive economic forces are taking hold along Colorado’s Front Range. In fact, all the main drivers of new home construction, home prices, jobs, population, and incomes, are expected to turn solidly positive in Greeley next year.
Home to Northern Colorado University and the North Colorado Medical Center, Greeley is projected to have some of the strongest population growth (1.8 percent) in the country. With a median home price of about $140,000 this summer, Greeley is an affordable alternative to Denver. A strengthening local economy will lift the median income here by 4.2 percent.
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