Park Hill Realtors Agree: Demand High, No Slowdown In Sight

Denver Housing Prices Among Highest in Nation

Several Park Hill real estate agents agree with new reports indicating Denver’s very robust market is likely to stay that way. A mortgage broker sees heavy activity in refinancing, and a nonprofit agency director observes pressure on modest housing.

“Low inventory still creates strong demand,” says Park Hill specialist Emily Roet. “The market is very robust, and there are more buyers than good listings.”

Anastasia Williamson agrees, but says the market is out of whack. She and others say many houses are selling with multiple offers above list price.

“When there is high demand – due in part to people moving to Denver – and low interest rates, inventory goes down and prices go up,” says Bridget Walsh of Denver Welcome Home. “Park Hill values are pretty much in sync with the rest of Denver.”

Kim Tighe of Cherry Creek Properties adds that many builders left in the economic downturn of 2008, and new housing wasn’t added. “In addition, people are reluctant to sell because they don’t have any place to go.”

Recent reports confirm that housing prices in the Denver area, for both purchases and rentals, are still some of the highest in the nation.

Bill Firmin, Senior Loan Officer of SWBC Mortgage, says most of his work is now in refinancing, with rates around four percent. “A lot of times offers are written for cash, and then a loan is placed before closing.”

Firmin and others say bidding wars are precarious for buyers. “In a bidding war, only one person gets the house and ten or so miss out and get discouraged,” he says. Firmin says houses are selling even before the first day of listing is over.

Roet says good agents sometimes advise sellers not to take the first offer, even for cash, because there might be a better offer later. She says 50 percent of properties have offers the first day.

Renters squeezed ever tighter

A resident of an apartment near Cheesman Park recently got a cash purchaser a day after she told a friend she was just thinking about selling.

In sharp contrast to Park Hill, Southwest Improvement Council Executive Director Jan Marie Belle says the market creates economic difficulties, especially those who are economically disadvantaged.

“We citizens will see increases in property taxes, mill levies, fees, and the like. New property valuations are based on Denver’s speculative housing market,” says Belle.

“Paying taxes on appreciation is a direct cash expense, in higher taxes as homeowners or increased rents passed on by landlords. We will be paying more to keep our housing. But the income of Denver residents has not increased at the same rates as housing costs.”

Belle calculates that spending 30 percent of income for housing, the median Denver household would pay $1,500 for rent or mortgage.

“Finding decent family housing at the rate is fast becoming unobtainable for new renters or first-time home buyers,” she says.

The real estate agents say rentals are even tighter than purchasing, and those looking for housing could often get a mortgage for less than rent.

Tighe and Williamson say some market pressure is driven by people “moving up” from the first home because family conditions change.

‘This is not a city of equity’

Despite enormous media attention to the legalization of cannabis, the real estate agents have no evidence or experience people are relocating to Colorado because of the availability of marijuana. “But some of that certainly is possible,” says Tighe.

People are moving to Denver from all over, for many different reasons, say agents. Roet says she knows one family returning to Denver from Philadelphia, and another on assignment at the Fitzsimons Medical Complex.

Some people from Park Hill are moving to other states, either by choice, for jobs, or for retirement. That movement adds some properties to the inventory.

Apparently, there’s little demand for single-family homes as rentals, even with the new short-term rental craze. Tighe says she knows of only one house in Stapleton purchased with the specific purpose of renting for part of the year.

None of the agents see any slowing in the Denver market for years. “If we do have a downturn, a lot of people could be upside down,” comments Tighe. “There are no guarantees, but I don’t see people buying to make a profit from the market.”

Walsh says economic cycles are “sure to happen, but nobody knows when.” She says real estate is like the stock market: “Bulls make money and bears make money, and only pigs get slaughtered.”

Roet says most people are buying for themselves, not for investment.

Williamson expresses concern about residential development. “Big multi-tenant properties could jeopardize neighborhood integrity,” she says. “Buyers still like Park Hill and Congress Park because of context and character. New development has to be sensitive to the existing area.”

Belle worries about inequity. “We meet daily with desperate people at risk of foreclosure and homelessness because they can’t make house payments dues to challenges such as job loss, income decline, divorce, and catastrophic medical bills.

“Families are struggling to keep a roof over their head and nutritious food on the table. What’s happening (in southwest Denver) is happening to everybody. This is not a city of equity.”

Walsh makes a similar observation: “If a seller lives in a poor neighborhood such as Swansea and is displaced, for example, by a big road expansion project that pays “market value” for the property, that person is going to have a hard time buying anything else in the Denver area.”

Millennials broke and in debt

While Tighe, Williamson, and Roet say people making cash offers are likely getting money from parents or family, most don’t have this option, says Walsh.

“Millennials are strapped with student debt and low-paying jobs. Many can’t afford to buy cars, start households, or qualify for a mortgage. Debt keeps them from becoming productive taxpayers. Their sometimes brilliant innovation is stifled. Those in default on student loans will never be able to get a mortgage.”

The real estate agents and mortgage specialist say most people eventually find a satisfactory home. The stress, frustration, and even added cost can be overcome if buyers and sellers get good advice from experts they trust.

Dave Felice is a member of National Writers Union Local 1981, and recipient of an award this month from the Society of Professional Journalists for news column writing. He is Chair of Greater Park Hill Community Inc. He can be reached at chair@greaterparkhill.org.