Yes, investing in real estate is a solid option in 2025 in Denver

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Thinking about investing in Denver real estate in 2025? You're on the right track.

Despite economic shifts, Denver's property market shows promising stability and growth potential.

In this blog post, we will explore why investing in Denver real estate remains a solid option.

We rely on reliable data and statistics from trusted sources to provide a comprehensive analysis.

By the end, we draw our own conclusions based on this thorough examination. Enjoy the read!

This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.

1) Denver's vacancy rate is just 6.5%, showing it's a bustling and competitive market

Signal strength: strong

The vacancy rate in Denver is 6.5%, which is considered very low. This low vacancy rate indicates that the market is highly occupied and competitive, meaning there is strong demand for rental properties.

When demand is high, it often leads to increased rental prices, making it a potentially lucrative investment for property buyers. In Denver, modern, one-bedroom apartments in areas like LoDo (Lower Downtown) are particularly sought after and easily rented.

These types of properties attract young professionals and singles who prefer urban living with access to amenities. Investing in such properties can be a smart move, as the rental market remains robust and continues to grow.

If the vacancy rate were to rise above 10%, it might indicate an oversupply of rental properties, suggesting a less favorable investment environment.

Sources: NeighborhoodScout, DataUSA, USCensus

2) Denver's "livability score" of 72 indicates it's a good place to live

Signal strength: moderate

Investing in Denver's real estate market is promising because the city boasts a livability score of 72, which is considered good. This score reflects the city's appeal, driven by its unique characteristics that attract residents and investors alike.

Firstly, Denver is known for its proximity to the Rocky Mountains, offering outdoor activities that enhance the quality of life. Secondly, the city has a thriving cultural scene with numerous museums and theaters, making it a vibrant place to live. These factors contribute to the city's attractiveness, supporting the idea that buying property here is a wise investment.

Additionally, Denver's strong job market, particularly in tech and healthcare, ensures a steady influx of professionals seeking housing. This demand for housing is a positive indicator for property investors, as it suggests potential for appreciation and rental income.

However, if the livability score were to drop below 60, indicating significant issues with quality of life, it might signal a less favorable investment environment.

Source: AreaVibes

3) Denver's employment rate is impressively high at 72%

Signal strength: moderate

The employment rate in Denver is at 72%, which is considered high compared to other regions in the United States.

This high employment rate indicates a strong and stable economy, which is a positive sign for potential real estate investors. When more people are employed, they have the means to purchase homes and pay rent, driving demand in the housing market.

Denver's economy is supported by three major employment sectors: technology, healthcare, and aerospace. Companies like Lockheed Martin and DaVita are significant employers in the area, contributing to the robust job market.

If the employment rate were to drop below 60%, it might suggest economic instability, which could make real estate investment less attractive.

Sources: USCensus, DataUSA

4) By 2025-2026, Denver's "Colfax Bus Rapid Transit" project is expected to significantly increase real estate values

Signal strength: moderate

The Colfax Bus Rapid Transit (BRT) project in Denver is set to be a game-changer for real estate in the area, particularly by 2025-2026.

As segments of the project are completed, such as those from Broadway to Williams St. and Williams St. to Monroe St., the improved public transportation infrastructure will enhance connectivity and reduce travel times by 30 minutes. This makes the area more attractive to potential homebuyers and investors, as efficient transit options are a key factor in real estate desirability.

With dedicated bus lanes, new stations, and improved sidewalks and lighting, the Colfax BRT project will transform the neighborhood, making it more accessible and appealing. This is likely to lead to increased demand for properties, driving up real estate values as more people seek to live in areas with better transportation options.

Investing in property along the Colfax Avenue corridor before the project's completion could be a strategic move, as early investors may benefit from the anticipated rise in property values once the infrastructure improvements are realized. The project's impact on reducing congestion and enhancing the overall transit experience further supports the potential for a positive return on investment.

Sources: Denverite, Denverite, Anne Dresser

5) Denver's metro area is experiencing growth, with its population rising by 1.09%

Signal strength: moderate

Denver's population growth, with a 1.09% increase in the metro area, is a positive indicator for real estate investment. Population growth often leads to increased demand for housing, which can drive up property values over time.

As more people move to Denver, the demand for housing is likely to rise, creating a competitive market for both buyers and renters. This increased demand can lead to higher property prices and rental rates, providing a potential return on investment for property owners.

Furthermore, the forecasted population growth in Denver, with an expected increase to 799,209 by 2030, suggests a sustained demand for housing in the coming years. This long-term growth outlook can make real estate in Denver a stable investment choice.

Additionally, the influx of young people and working-age adults into Colorado supports economic growth, which can further enhance the attractiveness of the real estate market. A strong economy often correlates with a robust housing market, as more people have the means to purchase or rent properties.

Sources: MacroTrends, Westword, Neilsberg, KDVR

6) Airbnb or "short-term rental" in Denver offers a fairly appealing profitability rate of 4.0%

Signal strength: moderate

The cash-on-cash return on Airbnb in Denver is 4.0%, which is considered moderately attractive for investors looking at short-term rental properties.

This percentage indicates that the income generated from renting out a property can provide a reasonable return on the initial cash investment. In Denver, short-term tenants often include tourists visiting for outdoor activities like skiing, hiking, and exploring the Rocky Mountains, as well as business travelers attending conferences and events.

These types of visitors are typically seeking comfortable and convenient accommodations that offer a home-like experience, making Airbnb properties appealing. The steady influx of these visitors supports the demand for short-term rentals, contributing to the attractiveness of investing in this market.

If the cash-on-cash return were to drop below 2.0%, it might indicate a less favorable investment scenario, as the returns would not sufficiently cover the costs and risks associated with property ownership.

Source: Mashvisor

So, is investing in Denver real estate a solid option in 2025? Absolutely, it is.