Forecast for Metro Denver Housing Market Includes a Drop in Home Prices in 2019

Some real estate housing market observers predict that metro Denver’s housing market will begin to cool off in late 2019, with home prices in some areas dropping more than 30 percent. In addition, a geographic research company recently used more than 200 variables to predict housing trends in Denver, Boulder, Greeley, and Fort Collins. The firm found an average drop in housing prices of 9.3 percent over the next five years for those areas, also starting in late 2019. A researcher with the company said the declines were tied, in part, to wages not keeping up with home prices. The Boulder area fared the worst with a predicted 17 percent drop, while the Greeley area remained flat. Metro Denver was projected to have a projected drop in housing values of 11 percent, but the declines varied drastically. The spokesman said the real estate market goes in cycles of 10 to 12 years, so since the last downturn happened around 2008, a 2019 downtown would sense. However, the spokesman said their research disagrees with the idea of a sharp drop in housing prices. In an article on DSNews.com, a marketing and research expert and a leading housing market observe who has worked with Freddie Mac, CoreLogic, and the National Association of Realtors, believes that inventory shortage and the squeeze on affordability will continue to impact the housing market in 2019. He said the inventory crunch is causing a consistent increase in home prices in the order of five and six percent, causing affordability problems in markets across the country. Consumer confidence has remained high despite rate increases, and the housing market shows an increase in first-time buyers. Another trend is the aging of the millennials, and we should no longer think of them as being young. The truth is that the largest age group in the United States is 28 years old. This group has become the prime renter age for the past five years and are now moving into their prime for first-time homebuying years.