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Back in 1992, Carl Abbott published a nice little book called The Metropolitan Frontier: Cities in the Modern American West.  It covers the development of cities in the American west since the 1940s. One of the interesting concepts Abbott discusses (on page 160) is "greater Texas." It's always been true that the United States has been a collection of economic regions rather than a single economy. If Colorado's economy were cut off from Mexico and Canada, it would probably suffer more than if it were cut off from New England. This is because the transportation lines and metropolitan economic system on which we rely point more west and south than they do north and east. Moreover, there is an economic affinity between metros in Colorado and the financial and oil-economy centers of Texas. In the map below -from Abbott's book- we find this metropolitan network which works it's way up from Houston, through Dallas-Ft Worth, and up to Denver. We encounter this...

Many people are familiar with this graph from Calculated Risk: Basically, it shows the number of months it took the job market to return to its previous peak. I couldn't find a similar one for Colorado, so I created a couple myself. See below. The first graph uses the Household Survey which measures employment by asking a sample of people if they want to be employed and if they are employed. So, this is a measure of the number of employed persons. I've simply indexed total employed persons as measured from peak to peak. Also, we only have data going back to 1976, so there are fewer recessions to measure here: We can see that by this measure, the 1991 and 2001 recessions were over quickly, in terms of jobs. In fact, one could argue that the 1991 job losses were cyclical and show no recession at all. On the other hand, the 1984 to 1988 job losses were very bad, and we find there a full 60 months needed for recovery. That's five years of lost jobs. Everyone wh...

The unemployment rate is good for basically one thing: comparing employment conditions in different markets at the same time. The unemployment rate isn't very good for comparing to the past because overall employment conditions have shifted significantly since the last expansion. The number of discouraged workers is much higher now than in, say, 2004, and the rates of under employment are higher as well. Neither of those things are really picked up in the unemployment rate, so it makes it hard to compare the present with the past. Nevertheless, we can get a sense of how Colorado compares to the nation right now by having a look at the two rates. So here they are, and I've thrown in the past twenty years: During March 2015, the unemployment rate in Colorado was 4.5 percent, down from 6.1 percent the previous March. Nationally, in March, the unemployment rate was 5.6 percent, down from 6.8 percent the previous March. The national rate fell further to 5.1 percent in April, b...

There is reason to suspect that nationwide, home prices may be leveling out. But that certainly doesn't appear to be the case for metro Denver. In the February Case-Shiller index , released in late April, Denver showed the highest year-over-year change in the index (10%), beating out even San Francisco (9.8%). The first graph show's Denver index compared to the 20-city composite index: It is apparent that the metro Denver index has already well-exceeded its old peak reached during 2007. In fact, the Denver index is now up 14 percent from its former peak. The 20-city index, on the other hand, is still down 16 percent from the 2006 peak. Fluctuations in the index has generally been less severe in the Denver index than in the composite index, as can be seen in the second graph. In recent months, we see that as the composite index has moderated, the Denver index has shown an acceleration in home prices, and has even reached the largest rate of increase seen in more than a...

The Metro Denver Apartment Association released first quarter 2015 vacancy and rent data late last  month, and we find that year-over-year rent growth hits exceptionally high levels for the second quarter in a row. The average rent during the 1st Q 2015 was $1,203, compared to $1,073 one year earlier. During the 4th Q of 2014, the avg rent was $1,168 The first graph shows the average rent for all quarters recorded since the survey was initiated in teh early 1980s by Gordon Von Stroh. Obviously, rent growth since 2012 has been significant. If we just eyeball the graph, we can see that the rate of growth in recent years has outpaced most other periods. Even during the late 1990s during the tech boom, rent growth was not as strong as it is now. These numbers are not adjusted for inflation, and during the period from 2003 to 2009, rent barely exceeded the CPI growth rate during many periods. But, rent growth is now well in excess of CPI growth. If we want to really quantify jus...

The March totals for multifamily permits in Colorado are now available from the Dept. of Commerce.. In March 2015, there were 1,196 new multifamily units permitted. During the same month of last year, there were 1,608 units permitted, which means multifamily units were down, year over year, by 25 percent. As we can see in the first chart, multifamily construction is up considerably from where it was in 2009, and is now at about mid-90s levels, which is a pretty robust pace. Although they has been talk of immense amounts of building, total construction may be flattening out. If we look at year over year percentage growth, we see that the change in multifamily units was either negative or at zero for eight of the last 12 months. Over the past five months, it's all been flat or downhill.  I've reduced the time frame for a better look at the last few years in the third graph. The trend here suggests a plateau in multifam construction. Why this should be the case is ...

According to the Colorado District bankruptcy court, bankruptcy filings were down 22.9 percent in Colorado in April, compared to April of last year. April was the 52st month in a row during which bankruptcy filings fell year over year. Bankruptcy filings have been generally declining since late 2009 following sharp  increases in bankruptcies from 2005 to 2009. The first graph shows trends since 2006. The downward trend has continued into April of this year, with year over year declines still well in place. The last four months suggest that declines have moderated a little bit, but year-over-year declines are still sizable. Comparing month to month, we also see that April 2015's total for filings is the second-lowest in nine years. So, at this point, we see no change in the filings trend.

March 2015 data for private housing units show that, overall, housing unit production continues to climb in both singlefamily and multifamily industries. At this time, however, there is no danger of new construction reaching anything like the levels seen during the housing bubble of 2003-2007. The first graph shows the last two economic cycles in terms of new units permitted. We can see that, while numbers are up considerably since the trough in 2009, they remain at levels more comparable to the early 1990s. Of course, if we account for population size, new construction is then lower than the early 1990s in practical terms. What do we see in terms of percentage growth? Singlefamily permit activity has largely flattened out. In January, the YOY change was negative at -4 percent, and over the past five months, growth has been under ten percent. Of course, this is still growth, so we shouldn't speak of singlefamily construction as if it has disappeared, but in a long term view, g...