Home Out Of Range: The rising cost of buying a home in Colorado

The housing market in Colorado is reaching new heights -- heights of insanity if you're a buyer. Along the state's Front Range, the cost of homes is setting new records, with homes selling for $100,000 over asking price. The FOX31 Problem Solvers are taking a closer look and answering questions: How did things get this way? What does the future look like for buyers and sellers? Is there anything that can be done?

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65% of Denver homes sell over asking price

Alyssa-and-Andrew-Hannig

“I could say easily we looked and were interested in 50-plus homes and quickly realized after crunching those numbers: forget it. We’re priced out,” said Alyssa Hannig.

She and her husband Andrew spent a year and a half looking for an affordable home in Colorado, and were close to giving up and choosing another state.

In order to get the home they purchased in Littleton, the couple had to offer $615,000 for a home listed at $550,000.

The home values in Denver metro and High Rockies counties are on average 50% more expensive than they were only five years ago. Single-family homes in any Denver metro or Front Range county are now at minimum $90,000 more expensive than the national average.

A single-family home in the Denver metro counties sold for a median $560,000 in March 2021. In Denver proper, they sold for $630,000.

62% fewer homes for sale in 2021 = Bidding wars, fast sales

In April of 2020, 6,885 houses and duplexes were available for sale across metro Denver. In April of 2021, the number of listings for all attached and detached homes had dropped 62% to 2,594.

Vanessa Barcus, a would-be home buyer, said, “You have to make the decision in 24 hours whether you’re putting in an offer or not, which is hard. You don’t really have time to sit with it and think about it.”

Nathan Chavez, another would-be buyer looking at the same house as Barcus, said, “We’re approved for $400,000 and we’re having to look at $325,000 homes. Under $350,000 because everything is getting like five to six offers at a time.”

Data from local counties shows the number of days a house is on the market dropped an average 28% just over the pandemic year. Since 2016, the number of days on the market has dropped nearly in half. In the cities surrounding the Denver and Boulder metro areas, homes only sit an average 10 days before sale.

“I’ve been selling real estate in Colorado for 44 years and I’ve never seen the imbalance that we have now between buyers and available properties,” said Edie Marks, a real estate agent with the Kentwood Company.

How did it get like this?

“We’ve got a lot of people who want to live here. Colorado is a great place. Denver is a great place,” said Professor Jeff Englestad, who teaches at the University of Denver business college. “I wish it was more sinister but it’s a classic supply and demand imbalance.”

On average, more than 20,000 young adults move to Colorado every year despite a lack of housing to welcome them, according to an analysis of U.S. Census figures by The Brookings Institute.

There just aren’t enough homes being built to meet demand.

“There’s just not one solution to this. We didn’t get here because of one reason,” said Leighty. He cites the the Great Recession of 2008, when housing went bust and many contractors went broke. And along with the labor shortage, lumber prices are rising.

» Even if Colorado could somehow double the number of housing permits issued, the Colorado Association of Homebuilders said it would still take three years or more to meet demand.


This story will continue throughout the week

Check back for more of our Home Out Of Range series, and watch the stories all week long on FOX31 & Channel 2.