Real estate agents all over the United States wait with eagerness for the annual report on real estate trends from PricewaterhouseCoopers and the Urban Land Institute. Brokerages and agents in Colorado are certainly no exception.
Here are the emerging real estate trends in the U.S. for 2016. Can we expect these trends to develop in Colorado?
1. Continued Popularity of 18 Hour Cities
Home buyers are flocking to cities wherein important amenities and recreation facilities are open for 18 hours or more.
This is especially true for individuals who work extended hours through the graveyard shift, like communications specialists, call center agents, or recreational establishments such as dance clubs and bars.
In recent years, some Colorado cities have evolved so that they are able to provide 18 to 24 hours services and facilities outside of the peak ski/vacation seasons.
Denver has the most extended-hour amenities. Boulder and Longmont are expected to follow suit. With this trend, it is expected that more people will choose to buy homes in the state, especially those who include Colorado in their holiday itinerary.
After all, why stay in a hotel or rent a vacation house during ski season when you can own your own Colorado home all year round? Many people are considering investment properties in CO this year.
2. Trend of Single Family Housing, Micro-Housing and Co-Housing
All throughout the U.S., it is expected that more and more first time home buyers will choose to purchase single family housing over apartment rentals. This is especially true among tech and financially savvy millennials.
In the case of Colorado, the 2015 real estate demand created significant appreciation.
Since property values in some areas of Colorado are quite high, pundits expect that sales may level off mid- year, as more millennials consider cheaper micro-housing options or even go for co-housing with family members or friends in order to split the cost of purchasing a home.
3. Appeal of the Suburbs
Homeowners from all generations find suburban living appealing and will continue to do so in 2016.
Reasons for this include affordable property values, the accessibility of supermarkets, restaurants, banks and other community amenities, and security.
Experts predict that there will be more suburban developments planned this year, including in the state of Colorado, in order to build communities which are attractive to certain age segments, particularly aging/retiring baby boomers and senior citizens.
4. Rental Housing
Many predict that rental housing will continue to be popular even with affordable mortgage rates.
In the case of Colorado, please note though that rental housing does not just mean that people will be renting apartments and condominiums.
Expect profit-minded millennials to invest their money into rental properties. In fact, it is predicted that these same millennials will be purchasing buildings and developing/renovating distressed properties for the purpose of renting or leasing them out.
5. High Tech for Millennials
Last year, millennials comprised a whopping 32 percent of the home buyers last year, beating out the baby boomers. Millennial tech savviness makes them excellent at searching online for real estate.
Millennials do not confine themselves to one data stream, using property ads on Craigslist, browsing through real estate sites like Trulia, and getting property advice from Realtor.com.
Because they are handy with smartphones, tablets and other mobile devices, real estate agents are getting more creative when it comes to marketing the properties they are selling.
One way is the utilization of Beacon technology which automatically sends property details to a potential buyer’s cellphone if he/she happens to be driving in a neighborhood with real estate on sale.
It is also expected that there will be more real estate apps being developed. Improvements are expected with popular apps, like Sitegeist, Zillow, and Vert.
6. Conservative Property Spending for Aging Boomers and Senior Citizens
There is some speculation whether or not aging baby boomers and senior citizens will spend their equity on a new home.
Despite mortgage interest continuing to be at reasonable levels, the worldwide economy has some instability, which may create fluctuations in interest rates. This may make older individuals reluctant to purchase new homes.
If they purchase a new house, it will likely be smaller, just comfortable enough for their needs, and with the convenience of accessibility to community facilities, particularly restaurants, supermarkets, and clinics and hospitals.
Don’t expect seniors to sell their homes either, especially in Colorado. Most likely, they will be making improvements to their home or by purchasing new recreational appliances like a brand new LED or plasma TV.
7. Student Housing for Younger Generations
The younger generations are not to be ignored, especially those who are going to college and will need places to live while studying. It is predicted that there will be a great expansion of student housing in the U.S., including Colorado.
In addition to student dorms and apartments, you can expect private homeowners renting out rooms for students right in their own home at affordable rates.
8. Lenders and Credit
Throughout the U.S., including Colorado, most Americans are not aware of the intricacies of credit and mortgage.
It is important for real estate agents to connect their clients with lenders who can determine their credit rankings and guide them on which debts should be paid off in order to improve credit scores, so that they can purchase their dream home.