Denver Home Prices Stick With Lucky 7 As More Building Permits Enter The Pipeline

Denver homes prices continue to outpace the nation (even as that growth slows), and will likely remain that way.

The metro area saw prices rise 7.6 percent in January, compared to the same month a year earlier, according to the S&P Case Shiller Home Price Index. Seattle and San Francisco again led the nation with double digit appreciation. Denver was lumped in a half dozen cities below that, all sharing 7.6 annual price growth.

Denver are prices have been up on an annual basis for almost six straight years. An imbalance of supply and demand is the essential problem. There still few homes for sale and demand to buy (coupled with population growth) is still strong.

But more construction is likely on the way. Permits to build single family homes to start 2018 are higher than they've been for 13 years in Colorado. The Census Bureau reports there were 4,657 single family detached home permits approved in January and February. Total approved building permits, including multifamily are up 32 percent over last year.

Builders are catching up after a slow 2017 construction season that included some issues surrounding materials. They're also responding to increased demand for homes.

Single family home construction has lagged since the Great Recession, creating a supply crisis in Colorado and in cities across the country. Still, even with the recent surge in permits, it’s not enough to dramatically change the current supply-constrained dynamic.