Continued Growth In Denver CO
Although it’s a good problem to have, especially for real estate sales and construction contractors, Denver, Colorado’s economy is growing far faster than the housing supply.
The city’s population has been growing at an average rate of around 2.5% for quite some time now, which calculates to around 1,000 people moving in per month. That’s a lot of new families needing a place to live!
Because of this, there is a big lack of construction specialists in the area. This post says it all:
“There is a 100 percent shortage of skilled construction workers here in Colorado and nationally,” said Michael Smith, Colorado Home Building Academy director.
It’s so bad the Association of General Contractors in Colorado estimates the need for skilled construction workers at more than 30,000 in the next five years.
That number does not include workers retiring, quitting and getting promoted to higher positions.
“They are already taking anywhere from 10 to 20 percent longer to build a house, and it’s due to the fact that we don’t have enough skilled labor in the field,” Smith said.
There has been a lot of talk of the housing shortage all along the Front Range of Colorado, with prices higher than ever. As of May 2017, the median price of a single-family home was well over $450,000, up more than 10% from the year before.
Cost of Living in Denver
The cost of renting a place in the Denver Metro area also continues climb. Even though it’s only 22nd in the United States for cost of a two-bedroom apartment, the fact that it’s up 4% from last year is what makes it difficult.
Most people don’t get a 4% raise every year, so it keeps eating away at the bottom line. In a previous blog, we discussed that a minimum wage worker in Denver would have to put in 95 hours a week to pay their rent.
This video provides some interesting facts about renting in Denver:
The American dream of owning your own home is an uphill battle for people along the Front Range of Colorado. As mentioned, part of the issue is that there aren’t enough skilled laborers to keep up with the demand. According to the Denver Post, “The amount of money being pumped into construction projects in Denver is on a record-smashing pace in 2017.”
It was reported that through October 2017, an estimated value of permitted work by the city was $3.27 billion. Obviously the real estate market is red hot, but the construction contractors can’t keep up with the demand.
The problem started with the market crash in 2008, when a lot of people were forced to find a different career. Many didn’t return to the trade, ironically because of the lack of affordable housing in the area for lower wage workers.
Free Schooling For Construction Labor
An area home builder, Oakwood Homes, decided to take matters into their own hands by creating Colorado Homebuilding Academy, a nonprofit organization that opened this year to alleviate the shortage in construction labor for Denver:
Inside an unassuming warehouse on the outskirts of Denver, 18 students are learning to saw, tile, drill, plaster and paint.
They are mastering how to build a house. While that number might not sound like a lot, today’s homebuilders are desperate for all of them.
The students are some of the first to enroll in an eight-week “boot camp” at the Colorado Homebuilding Academy, a nonprofit organization that opened this year. The course is free, founded and funded by Oakwood Homes, a Denver-based homebuilder.
If you are interested in starting a new career, this would be a great opportunity. For Denver contractors, it’s the only way to meet the needs of their industry.