Current Status of Colorado Market Other Than Denver

15 Replies

Figured it would be helpful to get and give an update on the Colorado market outside of Denver. Lots of posts about the state generally lead to the capital, but let's give the rest of the state some love. How about Fort Collins, Colorado Springs, Grand Junction, Greeley, Pueblo, Durango?

I'll give a general update on my area. I live 20 minutes east of Boulder, but west of I-25. New builds are everywhere. Everything from 1700 sqft to over 6000 sqft. The general base price is around 300k and generally gets you a two story home around 1700-2000 sqft. Even with the massive amount of building happening the prices continue to rise. One neighborhood even had raffles for lots since they have sold phase 1 so well. Cost of water continues to be a massive portion of the costs for building. We do live in a high desert, but grass is just so pretty and green...  Metro districts are the way for many of the communities to build the infrastructure so be highly aware of the taxes when looking in the area.

As for established builds. Inventory is low just like the whole metro area. Buyers all over are resorting to removing as many contingencies as they can to get a contract. Many are beaten out by cash offers. Established home pricing has risen consistently with townhomes and some condos leading the charge due to affordability. There was speculation that the oil and gas slowdown would affect the area a bit, but that does not seem to be the case. I have noticed some of the workers leave the area, but were very quickly replaced. Boulder and Louisville remain high in the price bracket and maintain a steady increase due to limited options for building. Lafayette is the next down the line and is looking like it wants to catch up with Louisville. 

Numbers are tight as far as investments go, but they can be made with diligence. I have come across multiple sellers who are selling off market and still attracting multiple offers. As for the time being there does not seem to be a slow down coming in the near future. Demand is high all over the area and supply just can't keep up.

So how is it in your corner of the state? Give some insight. We all know about Denver already :-)

I can pitch in for the Colorado Springs Market. 

Colorado Springs may be the second largest city in the state, however, our market is not like the Denver area. Average days on market for most of the spring time has been around 90 days with a 98% sale price to list price, which could be after one or more price reductions.

New build in Colorado Springs are minimal, however, there is a lot of growth and expansion just east in Falcon and Peyton as well as up north. I can't quite say your average price per sq ft here because prices can dramatically different for houses on the west end to the east end. East side you can expect to buy something newer than 1980 between 1800-2500 sq ft for the low to high 200's depending on where you are. You can expect to pay the same price for something on the west end that is newer than 1900 for even smaller homes.

As for investing, there are definitely deals to be had but they are becoming fewer it seems. More and more fix and flips are being bought by the buy and hold guys who are willing to pay more.

Our market is heating up and I have noticed general rise in prices over the past 6 months. I expect this trend will continue throughout the summer.

Greeley/Evans

median price in December 195k. median price in April 225k

That about explains it all. Our median price four years a go was $120k or so. Investing is tougher but still some deals out there if you are fast or willing to take on a lot of work. 

Mark, if my understanding of the Greeley area is correct, a lot of the growth in the last 4 years has been from the oilfield. I saw the same thing on an absurd scale in North Dakota. Has there been much movement since the the oil industry crash that we saw last year?

I've been passively thinking about a multifamily unit in Greeley. My siblings are out there at UNC and my brother is always egging me on about being his landlord.

Originally posted by @Spencer Nelson :

Mark, if my understanding of the Greeley area is correct, a lot of the growth in the last 4 years has been from the oilfield. I saw the same thing on an absurd scale in North Dakota. Has there been much movement since the the oil industry crash that we saw last year?

I've been passively thinking about a multifamily unit in Greeley. My siblings are out there at UNC and my brother is always egging me on about being his landlord.

 Some of the growth has been from oil field but not all if it. Nothing has slowed down since the oil crash as you can see from the e stats I posted. 

From a new investors perspective, the Northern Front Range is tough place right now to find deals. I'm trying to work primarily in the Fort Collins, Loveland, Windsor and Wellington areas and while there are deals, they go quickly even with tight numbers. Inventory is extremely low and homes are selling well above asking price, no contingencies and some even go sight unseen. The influx of people in the region has created a frenzy of buyer activity, so much so that even with the addition of new builds, we are sitting at only a few weeks inventory.

I'm sure the more experienced investors are adapting better than the newbies, but as a rookie myself (just sold my first flip), it is increasingly difficult to find a property where the numbers make sense. The good news is, once you do find a property, it is really hard to not make money! 

Yeah, I have been keeping a close eye on the Fort Collins, Laporte, Wellington areas and the market is red hot.  People are asking for insane amounts and getting it (ex: house bought four years ago for 150k, needs some work, now retailing for 235K without remodel).  It's really making it challenging to find a decent investment deal out here right now.  But, I will keep looking and something has to pop up!

We don't live in CO (though we are strongly considering moving there in a few years), but we did buy a fourplex in Colorado Springs last December. I'd actually been watching the market there for a few years, and while I know we missed the bottom, I'm happy with the property we bought. Cash flow and a decent ROI is definitely harder to find now than it was a few years ago.

We do have a friend from college who moved to the Greeley area last year, they were renting at first.  They were shopping for a house this spring, and he was getting pretty exasperated with how quickly homes were flying off the market as soon as they were listed.  They did eventually buy a house, though, a month or so ago.

I think we can all agree that the housing market along the Front Range is very strong. Maybe a little too strong? I know that I'm finding it very difficult to track down a deal. If you follow the Public Trustee auctions, they are few and far between with stiff competition bidding them up (Only one foreclosure in Larimer County this week, 2 in Weld County). I'm finding that my target area (Fort Collins, Loveland, Windsor, Wellington) is becoming increasingly difficult to work in. What avenues have others taken that have produced results? I've mailed out to NED's and a few absentees with 0% return rate. I would love to find something under FMV, but at this point, if it's slightly above I'm considering the property...

This leads me to my next question, which might be right up Mark Ferguson's avenue. I've really started to look into the Greeley market, but due to my lack of knowledge with that area, I'm very hesitant. I just closed on a flip and the seller was moving from Greeley to Loveland. Well of course I started to pick his brain about different neighborhoods and areas within Greeley. He said that he would not go any further east than 16th ave. I am familiar enough with the area to know that the further east you go, the more "problematic" the area is, but should I rule out those neighborhoods because they tend to have higher crime rates? I think that Greeley, Eaton and Evans are next up for the "big boom" and I would really like to get in now if the right opportunities presented themselves. Does anyone have any suggestions/recommendations for investing in these areas?

Lastly, I am currently studying to get my brokers license in the hopes that it will expand my knowledge in RE as a whole while also giving me direct access to the MLS. The issue I'm facing is, should I pursue working under a large brokerage? maybe a builder? Possibly a smaller brokerage or a management company? While working for an organization that allows me to grow as an investor would be ideal, I'm sure all avenues would provide great insight into the world of Real Estate Investing. And that is why I have to ask the question, "What makes the most sense for someone who wants to become a full time investor?". Being so new to the Real Estate world, I'm fairly overwhelmed with the variety of options as well as this raging bull of a market.

Any way you put it, the next few months should be very interesting!

Originally posted by @Bob Vollmer :

I think we can all agree that the housing market along the Front Range is very strong. Maybe a little too strong? I know that I'm finding it very difficult to track down a deal. If you follow the Public Trustee auctions, they are few and far between with stiff competition bidding them up (Only one foreclosure in Larimer County this week, 2 in Weld County). I'm finding that my target area (Fort Collins, Loveland, Windsor, Wellington) is becoming increasingly difficult to work in. What avenues have others taken that have produced results? I've mailed out to NED's and a few absentees with 0% return rate. I would love to find something under FMV, but at this point, if it's slightly above I'm considering the property...

This leads me to my next question, which might be right up Mark Ferguson's avenue. I've really started to look into the Greeley market, but due to my lack of knowledge with that area, I'm very hesitant. I just closed on a flip and the seller was moving from Greeley to Loveland. Well of course I started to pick his brain about different neighborhoods and areas within Greeley. He said that he would not go any further east than 16th ave. I am familiar enough with the area to know that the further east you go, the more "problematic" the area is, but should I rule out those neighborhoods because they tend to have higher crime rates? I think that Greeley, Eaton and Evans are next up for the "big boom" and I would really like to get in now if the right opportunities presented themselves. Does anyone have any suggestions/recommendations for investing in these areas?

Lastly, I am currently studying to get my brokers license in the hopes that it will expand my knowledge in RE as a whole while also giving me direct access to the MLS. The issue I'm facing is, should I pursue working under a large brokerage? maybe a builder? Possibly a smaller brokerage or a management company? While working for an organization that allows me to grow as an investor would be ideal, I'm sure all avenues would provide great insight into the world of Real Estate Investing. And that is why I have to ask the question, "What makes the most sense for someone who wants to become a full time investor?". Being so new to the Real Estate world, I'm fairly overwhelmed with the variety of options as well as this raging bull of a market.

Any way you put it, the next few months should be very interesting!

 I have a flip and a rental east if 16th. It all depends on the deal and numbers. I would definitely get to know an area before you invest there. 

My family is planning a move to Durango, CO. We are looking for a small multifamily property that we can live in while we manage it. Word on the street seems to be that the market is strong, but I've been stalking the real estate sites for a few months now, and I see a lot of houses that are staying on the market for a long time -- especially in a certain price range and/or that need some updating. I would love to hear from someone who's familiar with that area on your opinion about the strength of the local market, where (if anywhere!) the deals can be found for someone who's willing to put some sweat equity into a fixer upper, and whether the market appears to be getting stronger or weaker. I'd love to know anything else about the area that you feel is important for a newbie investor to know, as well! I've been reading a lot about REI, but I have a long way to go! :) Many, many thanks in advance for any information you can provide!

Merin Porter. I have lived in Durango for 15 years. I have also been investing in real estate for 15 years, but I only have one rental in Durango. The realtors snatch up any good deals lonnnng before they hit the MLS, and even just buying a house and turning it into a rental is not a cashflowing deal in most (vast majority) of cases. The best you can do is make money through appreciation, which is not coming back real fast after the crash.

Housing is in short supply downtown, especially apartments.  Finding a good deal on a multifamily is a very long shot.

@CaroleG, thank you so much for the input! I spoke with an appraiser (among many others) out there who really impressed on me the difficulty developers face when trying to build multifamily properties in the area. He said, "You have to ask yourself, if demand outstrips supply as far as it does, why aren't there more developments? It's because it's very difficult to do." If I can't make the multifamily option work, what would your thoughts/suggestions be on the possibility of buying a house on acreage with a guest house and above-workshop apartment and renting those out (or possibly building them if they don't already exist, since we're real DIY people)? What sorts of challenges do folks face in attempting something like that? I am wondering what La Plata County's general stance is on things like that if the home on acreage is zoned single family residential....

@Merin Porter. I think you could do that, as long as the home is not in an HOA, or if it is, as long as the HOA is ok with it. Homes with acreage also tend to be out on the mesa and therefore less expensive.

Time for my update since the year is coming to an end.

There are actually areas in Northern Colorado where homes are finally going for below asking. Not saying there is a slow down up here, but the increases have been so dramatic that owners are just shooting for the stars and getting underbid for once. Don't get caught up in the thought that everything is going to have multiple offers over asking.

New builds are still going up like crazy and have very minimal stock. Affordable housing is still flying off the market if it's in livable condition. 

Everyone in the Boulder area is waiting for Google to open their new campus. It will add somewhere around 700 new jobs initially to the area once they ramp up. The capacity of the first leg of their building is 1000 employees and they currently have 300 in Boulder already. There will be a second leg if they decide to build which can accommodate 500 or so more.

General overview is that things are still hot, but it is a little slower right now. Could just be the season.

Thats awesome to hear! I'm just getting started in the North Eastern part of the state, but always like to hear what is happening in other areas. From what I've been watching, things are sort of stagnet here. This being a smaller town, the holiday season pretty much pauses everything. However the market has steadily increased throughout the year. Home values in general have gone up 15-20k since the first of the year. Still gathering data on rentals, but I do know that things have been hard to come by up until the price of oil dropped.

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