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Real Estate Investment Market Report for Colorado, Utah, and Texas: May 2021

commercial construction loan

How do commercial construction loans work?

A construction loan is a type of short-term financing to fund a new construction project. If you’re planning to construct a multi-family home, apartment building, high-rise, commercial office building, or another type of large project, you will probably consider obtaining a commercial construction loan.

Commercial construction loans are different from other loans. Most loans are structured so the borrower receives the full amount they are requesting upfront. Then, once the loan is received, the borrower makes payments over a set period of time. However, with construction loans, the borrower does not receive the full amount upfront.

Understand the construction loan process

Market Activity

Denver, CO
Market Overview

Experts believe Denver is in for a big 2021. Since the start of 2021, three companies, in three different industries, have announced they are relocating or expanding into Denver. There are more than 20,000 housing units under construction and an additional 16,500 in the development pipeline. Looking forward, rents are expected to continue to rebound, construction demand will likely remain high, and investment activity isn’t expected to slow down.

1,661
Homes Sold
$540,000
Avg. Home Price
$1,894
Median Rent
Vacancy Rates Graph
Source: U.S Census Bureau
4.4%
Rental Vacancy Rate
0.5%
Homeowner Vacancy Rate
6.4%
State Unemployment Rate
Metro Area Unemployment
Boulder, CO
5.5%
Colorado Springs, CO
6.7%
Denver-Aurora-Lakewood, CO        
6.7%
Fort Collins, CO
5.8%
Grand Junction, CO
7.2%
Greeley, CO
6.9%
Pueblo, CO
8.7%

Market Activity

Salt Lake City, UT
Market Overview

Utah’s home prices are soaring as more people continue to migrate into the state, leading to an imbalance between its supply and demand. Salt Lake City’s April supply of inventory was less than a month’s worth, with median days on the market at just 26 days – down 42 percent from last year. Utah’s housing market is ranked 3rd in the U.S. for annual appreciation.

424
Homes Sold
$489,450
Avg. Home Price
$1,263
Median Rent
Vacancy Rates Graph
Source: U.S Census Bureau
5.4%
Rental Vacancy Rate
0.2%
Homeowner Vacancy Rate
2.8%
State Unemployment Rate
Metro Area Unemployment
Logan, UT-ID
2.1%
Ogden-Clearfield, UT                        
2.7%
Provo-Orem, UT
2.5%
Salt Lake City, UT
3.0%
St. George, UT
3.0%

Market Activity

Dallas, TX
Market Overview

As of April 2021, Dallas’ month’s supply of active listings was down to 1.3 months, an all-time low, according to MetroTex. This 1.3 month’s supply is 1.4 months less than April 2020. New construction over the last decade has not been nearly enough to handle the population growth that Dallas has seen. Home prices in the area are up 24 percent year-over-year and the median list price of homes is up 11.7 percent year-over-year.

1,486
Homes Sold
$400,000
Avg. Home Price
$1,724
Median Rent
Vacancy Rates Graph
Source: U.S Census Bureau
7.8%
Rental Vacancy Rate
0.9%
Homeowner Vacancy Rate
6.7%
State Unemployment Rate
Metro Area Unemployment
Abilene, TX
5.8%
Amarillo, TX
4.9%
Austin-Round Rock, TX
5.3%
Beaumont-Port Arthur, TX
10.8%
Brownsville-Harlingen, TX
10.0%
College Station-Bryan, TX
5.3%
Corpus Christi, TX
8.8%
Dallas-Fort Worth-Arlington, TX   
6.5%
El Paso, TX
7.8%
Houston-Sugar Land, TX 
8.0%
Killeen-Temple, TX
7.1%
Laredo, TX
7.9%
Longview, TX
7.8%
Lubbock, TX
5.8%
McAllen-Edinburg-Mission, TX
11.2%
Midland, TX
7.6%
Odessa, TX
11.0%
San Angelo, TX
6.1%
San Antonio-New Braunfels, TX
6.5%
Sherman-Denison, TX
5.7%
Texarkana, TX-AR
6.6%
Tyler, TX
6.5%
Victoria, TX
7.9%
Waco, TX
6.1%
Wichita Falls, TX
6.6%
Homes sold and average home price data is from Redfin.com. Median Rent data is from zumper.com.  Data shown in this email is an average over the last month unless otherwise marked.

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