Migration and rental trends in Colorado Springs show that our area has been growing steadily in the past few years, with many people migrating into our area. With an already limited housing inventory, coupled with an influx of people, the housing prices in Colorado Springs have soared.
Where are people coming from?
According to Apartment List, the highest percentage of people moving here came from Denver. The second largest source of influx was Dallas and the third was Houston. You can see the actual percentages below. It seems as though the largest influx is actually coming from within our own state. Colorado Springs still remains more affordable than Denver, and so many people may be relocating to our area for the lower cost of living. Colorado Springs remains an attractive place to live, for both people in and out of state, due to employment opportunities and quality of life. The cost of living in most other major cities far exceeds that of Colorado Springs, while our area still provides many of the same opportunities.
The overall population of our area has grown substantially, and continues to grow every year! The population of El Paso County is around 720,403 people (according to Census.gov estimates for July 2019). This is a 15.8% increase in population since the last official census in 2010. This increase in population is contributing to higher demand for homes, less inventory, and subsequently, higher costs for housing.
According to US News & World Report, Colorado Springs was nominated as the #4 Best Place to Live in 2020. This report is based on desirability, job market, quality of life, and more. Many people choose to move to our city for better opportunities in employment and education. Colorado Springs’ natural beauty and outdoor activities also entice newcomers.
An influx of people means higher rents
As more and more people move here, coupled with limited housing options, rents continue to rise. According to Apartment List, rents in Colorado Springs have increased significantly by 5.1% year-over-year. This is noteworthy because the rents in the state of Colorado overall have actually decreased 1.3% compared to last year, along with a national decrease of 1.3%. Yet, our area specifically is still seeing large increases.
With such high rents, should I just buy?
Looking at the graph below, you can see that Colorado Springs and Phoenix show nearly 5% increases in rent year-over-year. Most other major cities did not even come close to this increase in rent.
It is important to remember that every time your lease renews, your rent is likely to increase and you are going to be paying more for the same home. (Especially when rents are rising nearly 5% year-over-year). When you own your home, your mortgage payment remains the same each year. This provides financial stability (property taxes and homeowners insurance may vary slightly each year, but the principal payment should not).
According to a Zillow Report, “The U.S. median rent now consumes 27.8% of the country’s median income – nearing the 30% tipping point above which rent is considered unaffordable and the 32% tipping point above which communities can expect a more rapid increase in homelessness.” In addition, “renters are financially strapped enough that only 51% say they could accommodate a $1,000 expense, compared to 80% of homeowners”.
Changes in rent can wreak havoc on a budget, especially if you are already renting at the top of your budget.
When you rent a home, you are essentially still paying a mortgage– just someone else’s and not your own! You pay the mortgage without the possibility of ever owning the property or gaining any personal equity.
Not to mention, there are fees and rules/restrictions associated with renting that you might not have as a homeowner. Plus, did you know that despite rising prices, you can actually afford more house than ever before? This is due to record low interest rates! For most people, buying a home rather than renting is certainly advantageous.
If you are struggling to decide whether to rent or buy, please contact us! Our team of expertise can guide you through the process to come up with the best strategy for YOU!