We are new at real estate investing and would like to know what experienced investors think of the Denver market and its projections. Are there any surrounding suburbs that are better then others for investing (i.e. Highlands Ranch, Parker, Lone Tree, Aurora, etc...)? What does 2018 look like for the South Denver area? Thank you for your input. Much appreciated.
I wish I knew what the Denver market would do too. It is high but continues to increase. It has always been a boom-bust town. Avoiding any statement that this time is different there are some differences from the past. Denver has more economic diversity now so it won't be hit by a fall in oil prices, etc. It is also very popular for a good reason--it's beautiful and the weather and outdoors are great. Downside: popularity may decrease as wages are comparatively low.
I would caution buying outside of Denver for two reasons: 1. Traffic. It is bad and getting worse. As jobs grow downtown people will not want the commute. 2. Water issues. Many people don't worry about it but a number of southern areas depend on wells and/or purchasing water rights up north and piping it back. Well water is limited and gets progressively more expense as more pumps are required to obtain the same amount of water. Buying water rights (mostly from farmers up north), pumping water, building reservoirs and filtering it before using (see reverse osmosis) is expensive, even for cities (and their constituents via taxes). Many cities are spending hundreds of millions on projects--see Aurora. Others are not addressing it or were slow to the game. Either way water bills may get very high--multiple hundreds a month.
Denver has an old, well established water right system. It may even benefit by selling its excess to the others.
Entire metro will continue to see growth in 2018 and beyond. Our inventory is still historically low and people are still moving in like mad.
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