Metro Denver is a Millennial hub. Upscale, trendy, hip urban area, and of course the Rockies, Aves and Broncos! Yet a recent report stated that Millennials renting in Denver, see their future somewhere else.
They feel the need to move because, while its fun for a while, the cost of living is too high. At first, they (we all) rent(ed). Then, as we start careers and moving into ownership of the space we live, so we can control it, Denver, like many big cities, is not affordable.
Two out of three renters in Denver plan to eventually relocate to a more affordable area. 48.4 percent said it was lack of affordability. 21.6 percent said it was for better job opportunities. 4.4 percent said it was the weather!
Where are they going to go? Well, if you support growth, it is good news for the rest of the front range. Fort Collins, Boulder Greeley and Colorado Springs were the top four places the Millennials stated. Some will look areas that have even greater affordability. The affordability Index provided by the Fort Collins Board of Realtors shows the Affordability of housing, in comparison to the national average, has decreased (a good thing) for single family homes. It’s gone from 110% of the national average in 2015, to 94% year to date 2017. The bad news, for entry level buyers looking for a townhome or condo, is that, while the affordability index has fallen for condos and townhomes too, it has fallen from 162% of the national average in 2015 to 133% year to date 2017. Yup, condos and townhomes are 133% of the national average.
Most young adults are renters with fewer possessions, and no mortgage, so moving is easier. A lot of young adults try another city and realize that where they grew up wasn’t such a bad place after all!
This does not mean Denver will start having empty apartments, there is a constant flow of young adults moving up through the ranks every day so it is more like a churn. The percentage of U.S. households that had moved in the prior 12 months reached an all-time low of 11.2 percent. I think it does mean that growth will continue all along the front range and the communities that offer the most affordable housing will benefit the most.
See all the growth in Windsor, Severance, Eaton, Berthoud? The saying is you “drive till you qualify” so I don’t think all the growth will be in the larger towns and cities, I think the smaller communities will probably grow at a more rapid pace.
–Ross
