Did you know that when a home is sold, the benefits of that sale extend far beyond the sellers and into the community at large? In Colorado, that benefit amounts to nearly $72,000, according to a recent report from the National Association of Realtors in conjunction with the Bureau of Economic Analysis.
NAR explains that when a home is sold in Colorado, income is generated in many industries. The following are estimated figures:
- Income that goes to real-estate related industries, such as brokerage services, mortgage lending, title insurance, and home appraisal: $19,773.
- Money spent by home buyers/sellers on furniture, appliances, painters, etc.: $5,647.
- Money spent on remodeling the home within two years of purchase: $4,639.
- Money from the sale that flows into the economy in general and is funneled to restaurants, sporting events, charities events and more: $14,428.
- Income from new home production. According to the NAR, home sales induce additional home production. Typically one new home is constructed for every eight existing home sales. For each existing home sale, then, 1/8th of the value of a new home (median price $219,700) is credited to each sale of an existing home: $27,463.
Colorado’s economic benefit is one of the highest in the nation, trailing only Washington, D.C. ($140,000); California ($94,000); Virginia ($91,000); New Jersey ($89,000); Maryland ($76,000); New York ($75,000); and Washington State ($73,000).
Stay on top of Colorado’s housing market.
Get more tips at RE/Max of Cherry Creek’s blog.