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Forecast Strong Economic Performance Anticipated In 2015
DENVER – February 5, 2015 – The Metro Denver Economic Development Corporation (Metro Denver EDC) and the Denver Metro Chamber of Commerce presented the 2015 Metro Denver Economic Forecast yesterday at Vectra Bank's 22nd Annual Economic Forecast breakfast. The event took place at the Seawell Grand Ballroom of the Denver Center for the Performing Arts (view presentations and the webcast online).
The 2015 Economic Forecast is researched by Patty Silverstein, chief economist for the Metro Denver EDC, and reviews the events of the past several years as well as highlighting emerging trends for this year. The forecast includes national-level information and includes estimates for statewide indicators as well.
“Metro Denver will continue to benefit from solid economic performance in 2015. Even as we experience increasing employment and confident consumers, we need to recognize that our aging and retiring baby boomers and well-educated and ready-for-the-workforce millennials are changing the face of our community and influencing housing patterns and how we do business,” said Silverstein.
Compared with the national average, Metro Denver's employment growth in 2014 was more than 1.3 percentage points higher at 3.2 percent, which included gains in each supersector except information. Silverstein forecasts job growth in 2015 to be 3 percent, which represents the addition of about 45,000 jobs.
According to Silverstein, four supersectors of the regional economy should post strong employment growth in 2015: natural resources & construction (5 percent), education and healthcare services (4.1 percent), professional and business services (4 percent), and leisure and hospitality (3.6 percent).
“As the area continues to attract new companies, draw in talented workers, and promote entrepreneurship, Metro Denver will have better-than-average job growth and a lower unemployment rate than the United States and Colorado,” said Silverstein.
In fact, robust job growth in 2014 lowered Metro Denver’s unemployment rate in October to 3.6 percent, the lowest rate since October 2007. While unemployment increased slightly since October, the rate remains near historic lows for the region.
“With a forecasted average unemployment rate of 4 percent in 2015, our companies can expect to see a very tight labor market,” said Silverstein.
Silverstein also highlighted the demographic shifts that are changing the face of Metro Denver’s workforce. She noted that millennials (born between 1981 and 1997) now compose the largest population group in Metro Denver.
“While generation X and baby boomers dominate the workforce today, the millennials are making their mark on the workplace and will represent the largest component of the labor force within 10 years,” she explained.
Changing demographics not only have implications for future labor force growth patterns and consumer spending, but also residential real estate purchases.
The Metro Denver EDC's CEO Tom Clark says that with limited supply in the residential real estate market and above-average population growth, home prices and appreciation are rising and construction activity is picking up.
"While increased residential construction activity is very positive for our economy, we do see challenges related to millennials and baby boomers seeking affordable, owner-occupied housing due to almost flat construction of condos and a historic rise in apartment construction,” said Clark. “We are working with the state legislature on construction defects legislation to address this critical gap.”
The forecast for Metro Denver includes the seven counties of Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas, and Jefferson. Economic indicators analyzed include: population trends, employment by industry, unemployment, retail sales growth, commercial real estate, and residential activity.
|Metro Denver||2014 (e)||2015 (f)|
|Population||3.002 million||3.053 million|
|Employment Growth Rate||3.2%||3%|
|Non-Agricultural Employment (thousands)||Total: 1,512.6||Total: 1,557.9|
|Retail Trade Sales Growth Rate||5.7%||5%|
|New Residential Units||17,902||18,836|
Marc Blitstein has been a licensed Real Estate Agent since 2004. Real estate experience has been in employee relocation, residential property, short sales, investment property, and bank owned property....
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