Colorado in the 21st Century

Real estate has historically provided the most reliable means for generating wealth and passing it down to subsequent generations. Despite structural changes in the modern economy, real estate remains a very important part of a diversified investment portfolio but with one proviso: the real estate must be where the jobs of the 21st century are. Colorado is such a place.

Prof. Enrico Moretti of the University of California Berkley identified in his book “The New Geography of Jobs” the key factors driving the current and future economy.1 The 21st century disproportionately rewards industries that employ highly educated, creative workers in fields focused on innovation. A highly educated workforce has a great deal of freedom to choose where it wishes to live and work. Colorado has and will continue to benefit from this dynamic like few other places in the world.2

Colorado lies in the Rocky Mountains and has an abundance of natural allure. Colorado has 58 mountains over 14,000 ft tall (4,267 meters), numerous ski resorts, including some of the most famous in the world like Aspen, Vail, and Steamboat Springs, and over 13 million acres of national forest to explore. Combine that with an abundance of sunshine and Colorado provides a heavenly place to live. Highly-educated workers have noticed. Colorado has the second highest per capita rate of people in the United States with a bachelor’s degree.3 As a result, the Colorado economy is incredibly strong and has an exceedingly low unemployment rate.4

People move to where they can find the right combination of job opportunities and quality of life. Consequently, the population of Colorado is predicted to grow from 5.7 million people as of 2018 to 7.8 million by 2040.5 Continued population growth is a key ingredient in property appreciation.

Colorado is caught up in the virtuous cycle identified by Prof. Moretti in that economically competitive locations attract highly educated workers, highly educated workers in turn create more good jobs in a given industry (scale) and other fields (e.g., services), good jobs attract more highly educated workers and the cycle continues. This has led to three of the top twenty tech hubs in the United States being located in Colorado.6 Colorado’s real estate market should continue to benefit from this dynamic and provide a great real estate investing opportunity for those investors scouring the world for the real estate markets that will benefit from the dynamics powering the 21st century economy.

Colorado Market

Due to its inherent appeal and ability to benefit from a knowledge based economy, the Colorado real estate market weathered the Great Recession well and has experienced substantially greater appreciation than the national average over the past 10 years.7

Colorado Real Estate Compared to the National Average

Like any large state, Colorado is not a unified real estate market. PPIS works throughout the state but focuses primarily on two key markets, Denver and Boulder, and the communities in between.


Denver is the capital of Colorado and the largest city with the metropolitan area having 3 million inhabitants. Its population growth rate has outpaced the national average since the 1930s.8 Denver has a diversified economy and regularly ranks at the top of Forbes’ rankings for business and careers.9 As result, Denver has had one of the hottest real estate markets in the United States and has recently experienced years with  10% annual appreciation.10


Boulder forged a unique developmental path, which makes it a distinct market to invest in. Boulder sits directly at the edge of the Rocky Mountains and is the home of the University of Colorado. The beautiful location and academic hub have given rise to one the most vibrant startup communities in the United States and, by extension, the world.11 Established tech companies also have a strong presence in Boulder. For example, Google opened a campus in Boulder in 2017 that can accommodate 1,500 employees.12

The city’s elders had the foresight to implement the “Open Space Policy” (policy of purchasing the land around the city to prevent development) and to impose firm height restrictions on all buildings.13 These policies, combined with the strong local economy, have inversely decreased housing supply while stoking demand. The effect has been to create one of the strongest real estate markets in the country, one that is nearly recession proof.14 As a result, Boulder appeals to investors seeking stability and who value wealth preservation.

  1. Enrico Moretti, The New Geography of Jobs (New York: Houghton Mifflin Harcourt, 2012). See also
  7. U.S. Federal Housing Finance Agency, All-Transactions House Price Index for Colorado [COSTHPI], retrieved from FRED, Federal Reserve Bank of St. Louis;, May 14, 2018.
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  14. U.S. Federal Housing Finance Agency, All-Transactions House Price Index for Boulder, CO (MSA) [ATNHPIUS14500Q], retrieved from FRED, Federal Reserve Bank of St. Louis;, April 30, 2018.