Denver homeownership costs have grown 3 times rate of wages: report

DENVER (KDVR) — Owning a home in Colorado is not nearly as affordable as it used to be.

The price of homes in Denver has more than doubled over the last decade, and similar trends have been seen across the state. But while average home prices have been increasing across Colorado, wages and salaries have not kept up at the same rate.

A recent report from the Common Sense Institute of Colorado , a think tank focused on free enterprise, examined how the cost of homeownership has changed over the years compared to how wages have changed . The results varied from county to county, but the numbers show you have to work a lot more these days to afford a mortgage.

How much you have to work to afford a Denver mortgage

CSI’s vice president of policy and research, Chris Brown, told FOX31 that CSI uses economic data from sources like the U.S. Bureau of Labor Statistics to create the “misery index,” which tracks mortgage rates and home prices to determine the cost of owning a home.

“That’s what gives us that affordability index and what allows us to track the change in that index over time relative to wages,” Brown said.

The report found that homeowners in the Denver metro area need to work about 114 hours to pay a mortgage in 2023, up 172.3% from the 42 hours required to pay a mortgage in 2013.

According to the misery index, the cost of owning a home in Denver has increased by 18% since 2022, yet wages have only increased by 6%.

“The cost of home ownership has grown three times the rate of wage growth in Denver, and that’s similar for many of these counties that we captured,” Brown said.

In Adams County, for example, the working hours required to pay mortgage increased by 209%, going from 29 to 91.

How Colorado home prices compare with wage rates

Here is how home prices compared with wages across Colorado, according to the report.

It should be noted that CSI used average (mean) numbers for the rate of wage growth because of data availability.

“If the median is lower, then affordability issues would look much worse,” Brown said.

According to the U.S. Census Bureau , Denver’s median household income was $85,853, while its mean income was $122,771.

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