If you have been trying to buy or sell a house in Colorado recently, you know what the housing market has been like. It's crazy.

Colorado Has Been Enjoying A Seller's Market

There's no doubt about it, in Colorado it has been a seller's market. Though indications are things are gradually starting to level out, housing prices have been off the charts. That has made it more difficult for people who are trying to buy an affordable home, and it's also made it challenging for folks trying to find cheap rent.

I'm not a real estate expert by any means. Far from it. However, I have recently sold a three-bedroom, two-bath home recently in the $250,000 range and potential buyers were on it like flies on watermelon at the family picnic. Affordable homes for the average homebuyer have been hard to find.

The Argument For Renting

With the cost of housing so high - both renting and buying - many people are wondering if they are better off to rent right now or go ahead and take the plunge and buy. There is no easy answer, but a new study from Roofstock provides evidence to support the argument for renting in Colorado.

The study look at which U.S. locations have the highest rent-to-price ratios - which is just one metric that potential buyers can use when trying to decide whether they should buy or rent. If it's a market where the ratio of rents to the cost of homeownership is higher, it makes more sense to buy. If it's a case of lower rent-to-price ratios where homeownership costs are higher than renting, real estate may be overvalued and it could make more sense to rent.

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Colorado Has One of the Lowest Rent-to-Price Ratios

According to the Roofstock study, Colorado has the 8th lowest rent-to-price ratio in the nation. They took numbers from the Department of Housing and Urban Development, Zillow, and the Census Bureau and came up with this data for Colorado.

Rent-to price ratio: 3.48%
Median rent approximation: $1,700
Median Home Price: $586,317
Monthly mortgage payment for median-price home: $2,581

Compare those figures to the statistics for the entire United States.

Rent-to-price ratio: 4.80%
Median rent approximation: $1,435
Median Home Price: $355,852
Monthly mortgage payment for median-price home: $1,567

When you see these numbers, it is no surprise that so many people in Colorado are trying to find a place to rent. However, every situation is different and the housing landscape is fluid and ever-changing. Everyone has to look at their own unique circumstances and make the best decision possible.

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