First, a recap for those who have been hiding under the first Flatiron: in the past five – alright, seven – fine, ten years, Boulder’s real estate prices have skyrocketed, bumping many prospective buyers and almost all first-time buyers out of the high-stakes bidding ring. To this day, bidding wars continue, contingencies disappear from offers and cash still enjoys its reign as king.
Second, there was a point in time when this harsh homebuyer reality sent many a real estate agent ushering wary buyers to our surrounding L-towns – Louisville, Lafayette, Longmont and Lyons – for a better, more realistic deal. This strategy eventually petered as L-town prices also began to soar. (Denver, I’m looking at you, too.)
Third, no, I don’t actually believe that the earth or Boulder is flat. This is a hyperbolic metaphor used to describe the predicted plateau of the local real estate market. (Hang tight, impatient one – more on that here shortly.)
A recent Denver Post article shared some eyebrow-raising predictions for the metro area’s booming real estate market. Real estate data firm Location Inc.’s new forecasting product, Scout Vision, crunches numbers on over two-hundred demographic variables on local, metro and national levels to predict real estate trends and home prices in the coming years. After a data crunch on the Denver metro area, Scout Vision projects that median prices across the Front Range will fall as low as twenty percent between 2019 and 2022.
Was that a collective gasp I heard, or just my LEAF’s charging timer?
With years of rapid appreciation under our belts, we may start to see prices begin to fall in late 2019. The main culprit? The growing gap between incomes and home prices. Currently, there’s a wide, gaping chasm between home prices and wage growth, but slowly, we’re starting to see the this gap close.
Movement toward center isn’t coming from the real estate side, but rather the wage side. Granted, this isn’t in all sectors, of course; at a galaxy-dominating tech company (you know who you are, wink, wink), we’re seeing starting salaries in the six figure range for support staff positions – and that’s just for the non-techy jobs with vague, unsexy titles that make up the operative backbone of the company.
Even though my crystal ball is in the shop, I can still tell you this: there’s a definite chance that in the near future, our hilly little town’s sky-high real estate prices might flatten out a bit.
By Sean McIllwain, Mod Boulder Real Estate. Sean McIllwain is the current president of Historic Boulder and the founding broker at Mod Boulder Real Estate. Call 720.252.6051, e-mail [email protected] or visit modboulder.com.