Moving from renter to owner an uphill battle in Colorado
State has eighth highest “cost of moving up” ratio
The Denver Post
Most first-time homebuyers are renters, and one way to measure the difficulty of switching from renting to owning is by comparing how much the typical home costs versus the typical annual rent in a given location.
Nationally, median home prices are 18.27 times the median annual rent, or put another way, typical homes cost just over 18 years’ worth of rent payments in current dollars, according to an analysis conducted by Wendell Cox, a principal at Demographia, a St. Louis-based public policy firm.
But in several states, including Colorado, the “cost of moving up” multiple is larger. In Hawaii, the ratio is 33.8 or nearly 85% higher than the U.S. ratio. That is extreme, but in California, the ratio is 29.3, or 60.7% higher. In Massachusetts, the cost of moving up is 40.4% higher than the national average.
States in the Rocky Mountain region and Pacific Northwest dominate the remainder of the top 10 list, with the cost of moving up 39.3% higher in Montana, 37.2% higher in Utah, 36.5% higher in Oregon and 32.3% higher in Idaho. Then comes Colorado, in the eighth spot, with a cost of moving up ratio 31.5% higher than the U.S. average, followed by Wyoming at 30.5% higher.
“There is a general perception that house prices are higher where rents are higher. That is true. However, median house prices measured at the market (metropolitan area) level, tend to rise (at a) much greater rate than rents among the more expensive states,” said Cox in a blog post on the website Newgeography.
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It’s almost time to ring in the new year and if your holiday schedule is shaping up to be as packed as mine, I wish you a well-deserved rest in 2024. In the meantime, it’s our chance to party, and party we shall.