Real estate has long been considered one of the best ways for investors to hedge against inflation. Although inflation has begun to cool, the economy continues to be in flux and a recession may be looming. If you’re hoping to diversify your portfolio with an investment that’s all but certain to grow your money, purchasing real estate can be a savvy move. However, shopping wisely and buying property in a stable market is crucial. With home prices beginning to fall in many parts of the country, it’s more critical than ever to do your market research before jumping into real estate investing. Boulder, Colorado, is consistently named as one of the best places to invest in real estate in the nation. Here, I share more of the details on why and how buying in Boulder can be a great decision for your financial future:
Boulder Homes Appreciate Quickly
Boulder homeowners often benefit from much faster than average appreciation. SmartAsset ranked Boulder as the third most stable real estate market in the country, noting that home prices here rose 256.48% between 1998 and 2022. As recently as 2022, our city saw an average year-over-year appreciation rate of 17.2%.
Boulder Is Largely Considered Recession-Resistant
Whether you’re buying a home to enjoy for the long haul or you have your eye on a rental property, it’s important to note that Boulder is stable because of our city’s unique advantages. Boulder is considered to be virtually recession-resistant because our infrastructure is incredibly resilient. Several factors are at play here, including Boulder’s highly-educated population, Fortune 500 companies here that contribute to a healthy job market, and the persistently low inventory and high demand for housing. Although the market has shifted a bit, the lack of a balanced market here means that sellers remain in an enviable position.
What to Consider About Capital Gains
If the thought of buying a home in Boulder is appealing, but the thought of real estate taxes is giving you pause, here’s a quick primer on tax law. While it’s true that you can expect to pay capital gains taxes when you sell your home for more than you paid for it, there are ways to save. If you sell your property, the first $250,000 in profit is exempt from taxes for single taxpayers (and the first $500,000 is exempt for married couples). The taxes you’ll ultimately end up paying are dependent upon your income, so be sure to consult with your tax professional if you have additional questions.
With inflation remaining stubbornly high and an economic slowdown predicted, real estate may be looking especially appealing at the moment. Buying a home in a strong real estate market may be your best bet for maximizing your return on investment, and Boulder has historically been an excellent location to do so. Our city’s remarkable rate of home appreciation, the resilient labor market, and the quality of life to be had here all contribute to the strength of our real estate market. Although Boulder homes have excellent potential as an investment opportunity, navigating our market can be challenging. You’ll need an experienced realtor in your corner, so please contact me if you’re ready to start the process.