I know there have been quite a few posts on this topic, but as a current owner of a few Denver area rentals, I'm just have a really tough time seeing our market go much higher, and in fact firmly believe we're just about at the top, and over the next few years, units like mine (2-4 unit multi-family), is actually heading for a slight retreat. I am aware of the all of the Denver growth and jobs metrics that get posted in rebuttal to this every time it comes up. I also know all about the record low inventory, coupled with continued demand, and the pressure that has price. All that said, here are the items that have me standing where I do on this:

Price to Income: Like it or not, we are nearing an affordability ceiling with our local salaries that is going to slow growth to our state. While we had enough growth in 2016 to still be a top growth state, our growth slowed with Colorado adding 7.5% less people year-over-year in the last census cycle
Condos Conversions: I believe we're going to see a growing number of rental conversions to condos over the next few years. This will take pressure off the lower end (under $300K), which has driven a lot of the price growth in low end SFH the last few years. Additionally, I think this will soften rents a bit, as more people convert to owners.
Slim Margin Purchases: Watching closed deals, people are simply buying deals with way too little margin to be sustainable. They either don't know what they are doing, or they are counting on unrealistic rent bumps. Either way, many will crash and burn, and this will effect us all. Below is a perfect example in @Mindy Jensen's backyard. Current rents are $1,860 and there isn't a ton of upward movement there. With 25% down, PITI alone is around $1,700, add in opex and capex, and this property doesn't even come close to making sense. Yet if recent activity bears true here, the status of this property will move to pending within the next 10 days. Link to Duplex in Longmont - simply not sustainable.

Other Markets: The other wild card here is other over heated markets, that tend to be more cyclical. I believe there are other markets that are even more over heated and are headed for corrections even sooner than Denver. What does this have to do with us? Well a large amount of the price increases in Denver have been driven by investors. As other markets retreat and become ripe for investments, dollars will flow out of Denver, putting downward pressure on sales and sale price.

Denver, Colorado

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