Homeowners unable to cope with metro Denver’s rising home prices used to be able to look up and down the Front Range or in other areas of the state for a substitute, but affordable alternatives are getting harder to find.
The median price of a home sold in Colorado reached $600,000 for the first time in April, a sign that the big run-up in prices seen across metro Denver is at play across much of the state, according to a monthly update Wednesday from the Colorado Association of Realtors.
Median represents the midway point, meaning half of the homes sold for $600,000 or more in April and half sold for under that amount. In metro Denver, the median sold price for a single-family home was $660,000 in April, according to CAR. A separate survey from the Denver Metro Association of Realtors put the median sold price even higher at $684,550.
Using the statewide median price of $600,000 and an interest rate of 5.5% on a 30-year loan, a household would need an annual income of $166,860 to qualify for a home that expensive, assuming they can make a 20% downpayment and stick with standard underwriting on a loan. Colorado’s median household income in 2020 was just above $75,0000, according to the U.S. Census Bureau.
CAR noted that its Housing Affordability Index (HAI), which looks at mortgage interest rates, median sales price, and median income by county, fell more than 10% again in April. Affordability is now at its worst level since the index launched in 2010. And Denver and Colorado Springs are counted among the top 10 least affordable large metros in the country, according to OJO Labs.
Pitkin County is the most expensive housing market in Colorado with a median sold price of $6.5 million for a single-family home, up 3% on the year, and $1.9 million for a townhome or condo, which is up by nearly 107%. Summit County has a median sold price for a single-family home of $1.9 million, up 11.8%, and $805,000 for townhomes and condos, up 27.8%.
Eagle, San Miguel, and Routt, all ski resort areas, are the other counties where the median sales price of a single-family home was above $1 million last month.
“For the first time in the last 40 years, houses with plans just approved are contracting. Because inventory is getting less and less, I predict some Realtors may not be able to last through the next year or two,” said George Harvey, a Telluride-area Realtor, in comments accompanying the report.
Along the Front Range, Boulder County has the most expensive detached home prices with a median of $975,000, followed by Douglas County at $773,750; Denver County at $750,000, and Jefferson County at $724,110.
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One option for those who couldn’t afford metro Denver was to drive up or down I-25 until they found a community that better fit their budget. But the median single-family home price in Larimer County was $610,000 in April, while the median in Weld County, long considered a haven of affordability, was $505,000. El Paso County’s median was $489,0000.
“Affordability appears further out of reach for many buyers right now,” said Chris Hardy, a Fort Collins Realtor, in comments accompanying the report. “The run-up in home prices over the last couple of years is without precedent in northern Colorado.”
Adams County, at $563,500, remains the only county in metro Denver with a median detached home sold price of under $600,000.
So where might a household making the state median income of $75,230 more comfortably afford a single-family home at the median price? The best bets are Crowley, Prowers, Lincoln, Rio Grande, Logan, Conejos, Otero, Kit Carson, Bent, Cheyenne and Sedgwick counties, according to a mortgage calculator. Three counties — Baca, Kiowa and San Juan — lacked enough sales to calculate a median sold price.