In the last 2 years we’ve seen a double digit increase in median property values in Northern Colorado. Will they continue to rise at such high rates? According to research done by Everitt Real Estate Center at Colorado State University there will be increases in property values in 2016 but at a more modest rate. For example, while Loveland saw a 13% increase in median property values in 2015, a more modest rate of 7% increase in property values is projected for 2016. Berthoud is expected to see a 7% gain while Boulder will see a 5.5% gain in the coming year. Communities along the front range can expect to have similar increases in property values. This is of some relief to buyers who will see a break from the significant increases during the last two years. Homeowners will continue to benefit from increasing property values. For those that purchased homes at the tail end of the housing crisis, there could be significant equity in their homes and 2016 may be a good year to cash in.
The market in Colorado should be able to sustain continued growth. There will be continued demand for homes due to an increasing influx of people into Colorado. It is projected that 2016 will see 95,000 people moving in to the state and an estimated growth of 97,000 for 2017. What is the cause of the migration of people to Colorado? Colorado is a great place to live for recreation, a milder climate, lower property taxes than other states, a stable job market and of course, the marijuana industry surely plays a part as well.
The job market will continue to be stable in Colorado. According to a report by the University of Colorado Boulder, The 51st Annual Colorado Business Economic Outlook 2016, there will be continued growth in all job sectors except for the oil and gas industry. Richard Wobbekind, PhD, Executive Director of the Business Research Division at the Leeds School of Business at University of Colorado Boulder, stated, “The state is measurably outperforming due to the talented workforce, key infrastructure for entrepreneurship, diverse industries, and the aggressive efforts by state and local economic development.” According to the study, it is expected that we will see 65,100 new jobs in 2016. Specifically, the construction sector should see 9700 new jobs; education and health services should see 10,900 new jobs; leisure and hospitality will see 9000 new jobs and the professional and business services sector should see 15,500 new jobs.
Looking at the data, it seems that 2016 will be another good year for Coloradans with regard to the economy and the real estate market. Buyer’s can have confidence knowing that the value of a newly purchased home will increase over the course of the year. There is significant benefit for sellers as the demand for homes will still be strong.
Want to know what your property is worth? Contact me for a Comparative Market Analysis of your home or if you have any questions.
Sean Gilliam, RE/MAX Alliance