DENVER (KDVR) — It’s a small surprise that housing costs have spiked, especially considering how much more expensive it has become to build.
While the cost of a home along the Front Range has been cooling from highs last year, according to the most recent data from the Denver Metro Association of Realtors, the cost to build shows no sign of slowing.
The median sales price for a single-family home in the Denver metro area was $595,000 in January, down from a high of $680,000 last April.
Rental prices have also cooled. A report from the Apartment Association of Metro Denver showed the median rent for an apartment in January was down $27 compared to the previous quarter.
Nationally, the cost to build both multi-family and single-family housing has nearly doubled in the last 10 years.
The U.S. Census Bureau’s Construction Price Index has climbed steadily since the beginning of the last decade. It measures how costs for materials, equipment and labor and transport change.
The index in the fourth quarter of 2012 was 124 for apartments and condos. In the fourth quarter of 2022 was 203. For that same time, the single-family housing index rose from 100 to 199.
The pandemic had a much more dramatic impact on single-family housing construction costs than apartments. The cost to build a single-family home spiked 53% from the first quarter of 2019 to the last quarter of 2022. Multi-family homes, meanwhile, rose more steadily.
The swell in construction costs hasn’t been limited to residential buildings only.
Construction firm Mortenson’s office construction index has also nearly doubled in the last decade. It went from 100 in 2013 to 179 last year. Denver’s office construction costs now exceed the national average.