There was an interesting article on CNN where Case/Shiller predicted a double dip in the housing market. What is leading this decline? In my opinion the number one driver right now is oil prices. Many of the hardest hit areas were “exurbs” for example in the Denver market, Castle Rock would be considered and exurb. Another area would be Bailey Colorado & Conifer Colorado These areas were typically filled with newer homes and catered to borrowers moving up int he market. Many of these areas have seen the highest percent of foreclosures. The majority of folks that live in these areas commute to larger cities in order to work. As gas prices continue to move above three dollars they take a larger bite out of the family budget. This leads to a downward trend in prices as more people lose houses to foreclosure and new buyers are reluctant to relocate to the area since it will be too expensive to commute to their job. There was an article in a local paper called The Flume which highlighted a drop in population in Park County. Traditionally people who lived in these area commuted to Denver. This drop in population in exurbs will continue the downward pressure on housing prices. Furthermore, the commuting trend is altering the current housing price landscape along with the future housing price trends
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