If you’ve looked at the Colorado real estate market lately, you know that home prices have been growing at a steady pace for many months now. If you thought of buying a home last year, and waited to see what the market would do, you may be regretting your decision now.
Every passing month brings higher appraisals, and you may find yourself waffling between buying a home now, so you can get in on some of the incredible appreciation Colorado homeowners are enjoying, or waiting it out to see if these high prices are just a bubble that is going to burst, leaving you on the hook for a higher mortgage than you can sell your home for. It’s times like these you may wish you had a crystal ball.
However, if you understand what’s behind the booming real estate market in Colorado, fortune-telling skills may not be necessary. Some have speculated the increased demand for homes in the Colorado real estate market has more to do with more people being drawn to move to Colorado for alternative reasons we haven’t seen before.
There has been a correlation between the legalization of marijuana in Colorado and the increasing cost of homes. The state of Washington has seen a very similar housing boom lately. More people are moving into these two states to legally enjoy marijuana, and so there is more demand for housing than there are available houses. As long as supply exceeds demand, housing costs will continue to rise.
According to the CNN Money article, “How Legal Marijuana Biz is Boosting Denver’s Housing Market”
“In a normal market, Denver typically has around 24,000 listings, according to Moye. But right now, she said, there are only around 4,000. But there is a nagging question of just how long the real estate buzz will last. Moye said the market has room to run for five to seven years barring any major economic disasters.”
This means that even though we’re seeing high prices in homes today, the prices could easily continue to get higher. You can still buy real estate in Colorado today and possibly sell in four or five years and turn a profit. But ultimately there is no guarantee on how long the Colorado real estate market boom will last – as long as people are drawn here it will provide a strong stable pool of buyers and renters. There are many reasons that people are drawn to Colorado, legal marijuana is just one more reason the Colorado real estate market remains strong.