Buying a distressed home, like one facing foreclosure or in poor condition, isn’t just a recipe for a hilarious movie starring Tom Hanks. Taken at a metro level, it’s also a sign of the overall health of a housing market.
Denver had a very low proportion of distressed sales during July 2016, according to a report from Clear Capital: only 5.5 percent. The national average is 14.5 percent. That could just mean that the city is healthy. Or…
“This could be a signal that affordability is continuing to plummet,” Alex Villacorta told Clear Capital. “This, coupled with an observed rapid increase in price and a potential uptick in interest rates in the near future, may spell trouble for the [West].”
Basically, there are very few inexpensive fixer-uppers for first-time homebuyers trying to enter the market.
And Denver’s not alone in this. Top performing housing markets across the country have seen levels of distressed properties decrease much faster than the national average. And many of best-performing housing markets are in the West.
|Metro||Quarterly price growth|
|Tampa, FL — St. Petersburg, FL — Clearwater, FL||2.50%|
|Seattle, WA — Tacoma, WA — Bellevue, WA||1.90%|
|Dallas, TX — Fort Worth, TX — Arlington, TX||1.80%|
|Cleveland, OH — Elyria, OH — Mentor, OH||1.70%|
|San Jose, CA — Sunnyvale, CA — Santa Clara, CA||1.70%|
|San Diego, CA — Carlsbad, CA — San Marcos, CA||1.60%|
|Riverside, CA — San Bernardino, CA — Ontario, CA||1.50%|
|Las Vegas, NV — Paradise, NV||1.50%|
|Denver, CO — Aurora, CO||1.50%|
|Miami, FL — Ft. Lauderdale, FL — Miami Beach, FL||1.50%|
|Sacramento, CA — Arden, CA — Roseville, CA||1.50%|
Source: Clear Capital
More distressing (ha) still — among the top housing markets, Denver’s proportion of distressed sales was the third lowest:
At least Denver had higher proportion of distressed properties than San Jose. That metro area includes Palo Alto, a city so unaffordable that Slate called it a “parable for the failures of the affordable housing movement in this country.”