Debunking Denver Real Estate Myths: The Truth You Need to Know!
Have you ever heard the saying, "Don't believe everything you read?" Well, when it comes to Denver's hot real estate market, that saying couldn't be truer. From Wall Street buying up all the homes to believing that becoming a landlord is a cakewalk, there's a lot of misinformation out there. Let's debunk three of the most recent myths and set the record straight!
Myth 1: Wall Street is Snatching Up All Denver Homes
The Headline Hype
We've all seen those alarming headlines claiming that big investors are monopolizing the Denver real estate market. But is Wall Street really outbidding you on that charming Highlands Ranch home you've had your eye on?
The Truth Bomb: Your Neighbor Bob Rules the Market
Myth-busting time continues! Now let's look at another popular myth: Is Wall Street gobbling up all the homes, leaving none for first-time buyers? Spoiler alert: Not really! 🚫🏦
We've all seen those scary headlines, but the data tells a different story. While it may seem like big investors are monopolizing the market, they're not the ones sweeping up most of the properties.
👨👩👧👦 Reality Check: Mom-and-Pop Investors Rule
Guess who owns the lion's share of investment properties? Your neighbor Bob, or perhaps even you! The vast majority of investment properties are owned by regular folks—people who own between one to nine properties. So, let's give credit where it's due; our community members are the real MVPs!
📊 The Stats Don't Lie (Check out the graphs below)
Less than 25% of homes in the U.S. are owned by investors. And of that percentage, most are small-scale, mom-and-pop investors. Plus, some surveys even show that only 7% of home sellers are considering renting their homes instead of selling, thanks to current mortgage rates.
So next time you hear Wall Street is taking over, remember, the real estate game is more of a community effort. We're all in this together! 🏡🤗
Myth 2: Becoming a Denver Landlord is Easy-Peasy
The Appeal of Passive Income
Are you tempted to join the landlord club because interest rates are low? Well, let's hit the pause button and talk about why being a "by-accident landlord" might not be as breezy as you think.
🤔 Accidental Landlords: Yay or Nay?
A recent survey shows that nearly 60% of home sellers would consider renting out their current home rather than selling it. The appeal of extra income and the idea of owning a rental property is strong. But hold your horses!
🛠️ Reality Check: Landlording is a Business
Being a landlord isn't just about collecting rent. Imagine those 3 a.m. calls about a broken toilet or a storm-damaged roof. It's not just keys and contracts; it's a commitment. Are you ready for that kind of responsibility?
🚫 Airbnb Uncertainties
Thinking of Airbnb-ing your property? Keep in mind that many cities are tightening regulations on short-term rentals. This past June 4th, New York City had 22,500 short-term rental listings. After a new law passed, that number plummeted to just 4,600, leaving around 17,000 folks unable to continue renting their properties short-term. In contrast to New York City, Phoenix took opposite approach, allowing unlimited short-term rentals. As of 2023, this led to over 20,000 available units, but the high competition has many of them sitting empty for weeks So the Airbnb-ing avenue has its own set of speed bumps.
So, before you ditch the "For Sale" sign for a "For Rent" one, make sure you're ready for the full picture of property management.
Myth 3: Foreclosures are Skyrocketing in Denver
You've seen the headlines: "Foreclosure Rates Soar in Denver!" But do these headlines tell the full story?
Today, let's set the record straight on a buzz-worthy topic: Foreclosures. The word is all over the headlines, and I hear your concerns. So, let's talk straight.
The media is not exactly wrong; foreclosures are increasing. However, these alarming numbers often compare today's rates to those from two years ago, a time when foreclosure activity was unusually low due to the pandemic moratorium.
📊 Check out the graph below: if we're looking at the timeline of foreclosures from 2003 till now, the current increase isn't that shocking. In fact, we're not in a "foreclosure crisis" by any stretch. Think of it as a market course-correction after the "unicorn years" (those low-foreclosure pandemic times). Just check the graph below to see the ACTUAL figures.
So, no need for a panic room just yet! Always remember, context is king. 🤴
So there you have it! The next time someone tells you a Denver real estate myth, you'll be armed with the facts to set them straight. Remember, in real estate, knowledge is power. Want more truth bombs like these? Follow my blog and stay tuned for the next round of Denver real estate myth-busting!