Another sign Denver homes may be really unaffordable: very few distressed sales

staff photo

Buying a distressed home, like one facing foreclosure or in poor condition,Ā isn’t just a recipe for a hilarious movie starring Tom Hanks. Taken at a metroĀ level, it’s also a sign of the overall health of a housing market.

DenverĀ hadĀ a very low proportionĀ of distressed sales during July 2016, according toĀ 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 VillacortaĀ 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 fewĀ 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 thanĀ the national average. And many of best-performing housing markets are in the West.

Quarterly growth in top metro housing markets
Metro Quarterly price growth
Tampa, FL — St. Petersburg, FL — Clearwater, FL 2.50%
Orlando, FL 2.00%
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%
Honolulu, HI 1.60%
Jacksonville, FL 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%
Fresno, CA 1.40%

Source:Ā Clear Capital

More distressing (ha) still — among the top housing markets, Denver’s proportion of distressed sales was the third lowest:

The national average is 14.5 percent.

The national average is 14.5 percent.

At least DenverĀ had higher proportion ofĀ distressed properties thanĀ San Jose. That metro area includes Palo Alto, a cityĀ so unaffordable that Slate called it a “parable for the failures of the affordable housing movement in this country.”

 

Thanks for reading another Denverite story

Looks like you’re the type of person who reads to the ends of articles! Well, true believer, you might really like our morning newsletter. It’s quick, free and gets you up to speed on the important and delightful things happening right here in Denver. Does Denverite help you feel more connected to what’s up in your area? Do you want to be a part of it?

Member donations are critical to our continued existence and growth.

Weird times

Denverite is powered by you. In these weird times, the local vigilance, the local context, the local flavor — it’s powered through your donations. If you’d miss Denverite if it disappeared tomorrow, donate today.

You’re our superpower

Denverite supporters have made the decision to financially support local journalism that matters to you. Ready to tell your networks why? Sharing our ā€œAboutā€ page with your own personal comments could really help us out.

You’re our superpower

Denverite members have made the decision to financially support local journalism that matters to you. Ready to tell your networks why? Sharing our ā€œAboutā€ page with your own personal comments could really help us out.