From John Rebchook:
Note that these totals are Statewide figures. The Statewide figures showing filings up is influenced in large part by activity outside the Denver Metro Area – for instance, in Mesa County (Grand Junction) filings increased by 22.5%. In Weld County – a formerly hard-hit area, filings were down by 9.5%.
These two extremes are explained in part by the oil and gas industries – the West Slope gas industry boom of the mid-to-late-2000’s drove tremendous growth in home prices and development in areas like Grand Junction. The gas supply nationwide peaked right as the economy collapsed, causing gas prices to plummet and the industry to pick up stakes and leave town – leaving many in Grand Junction, Rifle (Garfield County) and other similar areas who purchased homes at the peak of the market holding the bag. (Incidentally, this collapse in gas prices has led many public utilities to shift to gas-fired power plants as opposed to using coal).
In contrast – Weld County has been the epicenter of new oil development as the Niobrara formation of the Denver-Julesburg basin (DJ Basin) has recently been heavily developed via the use of horizontal drilling and hydraulic fracturing (fracing). This has led to a boom in industry along the US Highway 85 corridor from Denver to Greeley – which has been good for the economy and real estate in these areas.
Incidentally, as the D J Basin oil development has proved successful, exploration companies are now looking further afield for other “source-rock” oil field areas – one of which may be the Pieciance Basin area of the west slope – this could help stabilize the west slope economies as drilling picks up again.
Unfortunately, much of the pricing that drives oil exploration is based on the price of oil in the global market – where demand for crude is slowing as large economies of Euproe and Aisa slow. If economic growth resumes – oil prices will rise and exploration and development will again increase… but, I digress – back to real estate:
In the Denver Metro area, the decline in foreclosure filings is very apparent according to the article:
The counties with the largest decreases in foreclosure auction sales, year over year, were Boulder County and Denver County where auction sales decreased by 41.1 percent and 37.9 percent, respectively.
This dries up the supply of available homes – which is one of the drivers for the robust housing market in Denver.