I attended a BIG residential and commercial land conference on the 23rd and here is a sample of what I learned—
- In the vacant land market the #1 question is “how high can prices go?” Still demand exceeds supply and on great pieces of land the seller will receive multiple offers.
- In the last 12 months there have been 17 closings on land deals exceeding $10 million in the metro area, the most ever.
- 3 of these pieces of land are in Douglas County and zoned for residential building.
- A piece of land at 99 South Broadway on which apartments will be built, cost $50k per apartment unit!
- 1/3 of finished buildable home lots are in Douglas County, this means a ton of new construction there soon.
- We currently have 15 months of supply of buildable home lots. Builders like to have 24 months at least.
- Land prices in Downtown can be as much as $600 a square foot just for the land!
- Metro Denver’s job growth rate has accelerated this year to 3% as of the 2nd It’s predicted we will create 46k new jobs this year.
- State-wide incomes are up 5.2%.
- The State Demography Office expects we will see population growth of 50,000 people a year thru 2022 in metro Denver. 30k net new people will be moving here and births will exceed deaths by 20k a year.
- What are builders doing to keep home prices “affordable”. Richmond American cited smaller and smaller lots (as small as 1600 square feet) for their CityScapes Collection. The homes will have 1700-1900 finished square feet with rooftop terraces.
- Richmond is also building duplexes of 1260-1400 square feet with no basements to keep prices affordable.
Why is this land information so important? This tells us about the confidence of builders and developers have for our region’s economy for the next several years. If they were worried about a recession or a slowdown they wouldn’t be buying so much land.