Something’s Brewing in Fort Collins as it Expects to Outperform Housing Projections
While some housing markets in the United States struggle with affordability or even availability, others are flourishing and should continue to do so through at least 2024, if not longer.
Take Fort Collins, Colo. for example. Nowadays, there’s a lot more on tap in this city than just the Anheuser-Busch and other craft beer breweries that attract visitors to the town.
It, along with several other markets that are doing well, should all outperform initial projections for that market over the next three to five years, according to a study released in December by the National Association of REALTORS® (NAR).
“Some markets are clearly positioned for exceptional longer-term performance due to their relative housing affordability, combined with solid local economic expansion,” said NAR’s Chief Economist Lawrence Yun. “Drawing new residents from other states will also further stimulate housing demand in these markets, but this will create upward price pressures as well, especially if demand is not met by increasing supply.”
The 10 most notable markets expected to outperform projections also included Charleston, S.C., Charlotte, Colorado Springs, Colo., Columbus, Ohio, Dallas-Fort Worth in Texas, Las Vegas. Ogden, Utah, Durham-Chapel Hill in North Carolina and Tampa-St. Petersburg in Florida.
There were a number of factors that made these markets project to be the hottest as far as real estate over the next half-decade, including job growth compared to the national average, housing affordability, the structure of the age population, their attractiveness to retirees, how likely they are to attract new residents from out of the area, and the appreciation of home prices over time.
“Potential buyers in these markets will find conditions especially favorable to purchase a home going into the next decade,” said NAR President Vince Malta, a broker at Malta & Co., Inc., in San Francisco. “The dream of owning a home appears even more attainable for those who move to or are currently living in these markets.”
A significant chunk of the total population in the Fort Collins market (approximately 58,300 people, or 17 percent) moved into the area recently, and 74 percent of those are renters.
That rent number shouldn’t surprise, since the median age of all recent movers to the area is 28 years old.
Still, despite the youthful nature of this population boom, 15 percent of those recently moved renters can afford to buy a home at the median price of $404,700 assuming a 20 percent down payment. The median income of individuals who have recently moved to Fort Collins is $50,000, which would also indicate those looking for workforce housing (middle-income earners) are finding what they need in this market.
As the young average age would indicate, two-thirds of these recent movers (66 percent) are single individuals, likely looking to begin their careers in a place they can both find work and simultaneously afford to live. The remaining 34 percent are either married couples or families, meaning they are looking for a place to set down roots for their families while finding a place that is affordable to live and work. The average length of time people own a home in Fort Collins is only eight years, but that is likely to go up with a younger group of new homeowners coming into the market looking to make Northern Colorado their home.
While a majority of the recent movers have come from other parts of Colorado, specifically from Denver where there is a bit of a housing crunch, a good chunk of new residents have been migrating from out of state, with arrivals from Chicago, Los Angeles, D.C., Kansas City, Mo., Cheyenne, Wy. and Riverside, Calif. registering more than just a blip on Fort Collins’ radar.
It doesn’t come as a surprise that NAR sees it as a market that will exceed expectations. According to a report in The Coloradoan, job growth in Fort Collins saw an increase of 18 percent (approximately 31,000 jobs) in a five-year span from October 2014 through October 2019.
The same report also identified Fort Collins as having the ninth largest job growth in the U.S. during that same time span.
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