Metro Denver currently has a shortage of existing homes for sale, causing homebuyers to seek out new homes and developments, despite low supply and high prices.
The Denver Post reports that builders are working to offer affordable alternatives, including townhomes and duplexes. Single-family starts in Denver increased by just 2.4 percent last year, while townhome went up 25.2 percent, and now account for a quarter of all new starts. "Condo starts, long depressed, only saw a 7.4 percent gain last year despite the passage of a bill to make construction defects litigation more difficult."
Mark Boud, chief economist at Metrostudy, forecasts 1.256 million homes will be built in the U.S. this year, which only brings the country back to the volumes seen in 1992. He estimates the housing shortfall at 2.5 million units, a gap that will contribute to upward pressure on prices. “We have supplied too few homes compared to economic growth and economic growth continues at a high level,” he said.
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