“The five-year surge in real estate demand across the West is starting to take its toll in some areas as buyers become more reluctant to purchase a home that would eat up a large chunk of their monthly earnings,” reports Bloomberg. As a result, markets are slowing.
Bloomberg notes that Denver, Los Angeles and Austin, Texas, have all seen a drop in the rate of home appreciation – which had soared to as much as 71% in Denver, 66% in San Francisco and 54% in Austin, in the past five years.
“Buyers are starting to push back and say, ‘I’m not going to pay that much for that house,’ one industry observer told Bloomberg. Homebuyers have begun eschewing the city centers and expanding their searches to outlying areas (such as Arvada and Englewood in the Denver metro area), where prices are more affordable.
Meanwhile, the recent spikes in rents are beginning to cool, as well. Average apartment rents in metro Denver rose only 1.5% from September 2015 to September 2015. This compares to an 8.9% increase a year ago and is the slowest annual gain since 2010, reports the Denver Post, citing a study from Dallas-based Axiometrics, a company that offers apartment data.
Average apartment rents dropped from $1,407 in August of this year to $1,394 in September. While the cost decline isn’t going to make anyone rich, the downward trend clearly offers hope for renters feeling the pinch in recent years.