This millennial couple with a pandemic baby decided to sell their Chaffee Park starter home and buy a bigger place in Montclair. They were gobsmacked by the process.
“We are probably the last ilk in this city to be able to buy a starter home and then trade up,” said Jason Hornyak.
Jason Hornyak is fluent in real estate lingo and has studied Denver’s housing crunch. But when he and his wife had a pandemic baby, they started working remotely and decided to buy a bigger place to accommodate those changes. At that point, even he found himself shocked by how hard it was to find and buy a new house and how easy it was to sell one.
He and his wife, a middle-class couple, bought a home in Chaffee Park in 2017. He headed up the area’s registered neighborhood organization. He’s also a board member of YIMBY Denver. YIMBY stands for Yes in My Backyard. It’s an urbanist organization working to advocate for denser neighborhoods throughout the city to ensure there is housing for all.
He knows the area median income for a family of three, like his, is $94,320. And he’s grateful. He works as a geographer (a GIS analyst), and his wife works in social media marketing. Together they make more than the median. So, when it comes to housing, his family is not cost-burdened, meaning they do not spend more than 30% of their income on housing costs.
In short, Hornyak and his family were in a good position to upgrade homes.
Surely, a middle-class family that had purchased a starter house several years ago would have no trouble buying a larger home to accommodate a shift to working from home and a new baby.
“We decided to jump into this housing market again, with trepidation, back in late summer,” he said. “So then it took a couple of months for us to find a place after some false starts and failed bids and such.”
The couple found few homes available in their price range.
“We found that the lack of inventory, the lack of supply was really, really difficult for us to navigate even coming from a place of comfort financially,” Hornyak said.
They put in several bids on houses and were outbid by higher-paying homebuyers willing to shell out significantly over the asking price. They hoped to live in a walkable, urban community and ended up looking on the east side of town to the Montclair neighborhood, which had good schools but was less walkable than they hoped.
“The house we ended up getting, we had to put three offers in,” Hornyak said. The first was well over asking price, and they believed it would be competitive. “We heard back from the selling agent who said, ‘There’s a lot of offers. There’s like five offers in and you guys aren’t winning.’ So we’re like, ‘Oh, okay, well, I guess we’ll have to come back with another offer.'”
They offered significantly more money, but it was still not high enough.
“The agent said, ‘Okay, here’s where the highest offer is,'” Hornyak recalled. “And she liked our terms that we had other than, you know, the price. So she said, ‘If you guys can beat this number, then we’ll give you the house.’ And so we had a long talk about it. And it was considerably higher than our budget, than what we had planned to spend, what we wanted to spend. But we figured out how to make it work by tightening some belts here and there.”
Eventually, they successfully bought their new home — which Hornyak acknowledged they could do largely because they were already homeowners.
“As far as being on the selling side of that same question, it was crazy,” Hornyak said. “We got more offers on our house than our agent had ever seen in her 15-year career.”
For the last two months of the selling process, they kept an eye on similar properties to the home they were trying to sell.
“We would do searches for like a three-bed, two-bath 1500-square-foot house like the one we were selling in the whole city, and there would be one or two in the whole city for sale that were below a million dollars, which was well above what we were selling,” he said. ” So we could see like, oh my God … if people are looking for this and many people are, there’s no options for them.”
Ultimately, two people bid for the house using unlimited escalation clauses — a tool that allows a buyer to outbid any given offer. One such clause in a sale is rare. Two is virtually unheard of. Both went well over $100,000 of the asking price.
“We ended up going with not the highest offer,” Hornyak said. “But they had better terms for the deal, like waived inspection. They didn’t have to do an appraisal, you know, stuff like that. You really lose a lot of your power as a buyer in this crazy, crazy market. It’s not a great position to be in as a buyer, obviously. But when there’s so few options, you lose all your power because there’s such little inventory.”
Hornyak and his wife are older millennials, and he worries about younger people wanting to buy a home in Denver.
“We are probably the last ilk in the city to be able to buy a starter home and then trade up, so to speak, like we did. There’s no way we would have been able to buy our new house if we hadn’t have bought our old house,” he said. “It’s the game you got to play.
“And we got in, in the last opportunity we could have in 2017. We already thought we were in a race against the clock because we saw the direction things were going. I consider us very lucky that we were able to do that. And I don’t think that anyone below my peer group in terms of age range will be able to do that in the city anymore. Because we’ve turned ‘starter home neighborhoods’ into ‘forever home neighborhoods’ just by virtue of driving the prices up.”
When selling, Hornyak’s family benefitted from the low supply of homes.
“There are things we could do in the city to remove regulations on supply that are really just put in place to help incumbent homeowners like myself,” he said. “I see that. And I just went through it. And I see how the system is rigged in favor of people like me, and it’s not right. And it sucks to succeed in a system where it’s hurting people who aren’t already in that system.”
Hornyak has strong opinions when it comes to how the city should address its housing crisis, which he blames on far too little supply. He wants to see neighborhoods zoned for single-unit homes embrace more types of housing.
In Chaffee Park, Hornyak was part of a group that successfully advocated for rezoning the neighborhood to include accessory dwelling units, backyard homes people can use as rentals for secondary income or to house relatives. When old houses are scrapped, he’d prefer to see duplexes and multiplexes be built on lots instead of massive single-unit homes. And rather than concentrating the burden of density in a few neighborhoods, he’d like to see all Denver neighborhoods take in some of the growing population.
The fix, as he told it, is free for the city.
“Allow more people to live in our neighborhoods,” he said. “Allow our neighborhoods to change gradually in structure as the city grows. And that’s, of course, by a gradually incremental increase in zoning in all of our neighborhoods, to allow more diverse housing types to be built in our single-family neighborhoods that have been locked away from any sort of change, to the benefit of the incumbent landowners, for decades.”