'Drive till you qualify': Affordable home search pushes buyers farther from Fort Collins

The Rolling Stones sang “you can’t always get what you want” in 1969. Prospective home owners are singing the same tune more than five decades later as they're faced with driving farther outside Fort Collins than ever to fulfill that American dream of home ownership.

Just three years ago, home buyers could go a few miles east to Severance, north to Wellington, south to Loveland and west to the foothills to find that white picket fence and yard for the dog for less than $350,000.

That dream slowly eroded over the last three decades when The Group Real Estate co-founder Larry Kendall coined the term “drive till you qualify” as Fort Collins' home prices began to creep up. In those days, driving until you qualified meant just a handful of miles in any direction from Fort Collins.

Now, those boundaries have been pushed completely outside of Larimer County, into rural Weld County and even southeast Wyoming as the median single-family home price in Fort Collins topped $533,000 at the end of September.

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Sure, there are pockets of homes for sale under $400,000, even in Fort Collins.

But you have to go east to Ault, Evans, LaSalle or Greeley to find a communitywide median home price of less than $400,000. LaSalle and Ault are the only communities in Northern Colorado with a median home price at or under $350,000. Cheyenne's median home price within city limits is the lowest in the area at $310,000. Prices outside city limits, however, are approaching $500,000 as buyers living near Wyoming's capital city seek larger lots.

"That pattern has been going on for quite awhile," Kendall said. "We began to notice it in the early to mid-90s" when there was a similar shortage of housing inventory and "prices spiked quite a bit."

It's forcing a growing number of homebuyers to choose between living where they want — close to work, shopping and entertainment — or having the home they want at a price they can afford.

The push into rural areas is putting more cars on already crowded roads, contributing to carbon emissions, driving home prices up in once-affordable areas and affecting every Northern Colorado community.

"It's more than just driving, it changes the whole fabric of each community in Northern Colorado," Kendall said. "What happens is cities become more and more job sites than communities." Back in the day, buyers willing to drive 20 minutes could save about $5,000 per minute, or roughly $100,000, by forgoing Fort Collins, he said.

That same equation doesn't hold up today as prices soar throughout Larimer County and buyers are moving farther and farther from the city centers, either by choice or necessity.

"To a large extent, it's creating a community of first-time buyers," Kendall said.

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Making the hard choice

When Richard Martinez returned to Northern Colorado in 2020 after living in Denver and Colorado's Western Slope, he moved in with his grandparents in Ault — where his family has lived since 1926 — to get re-established.

He wanted to be in Fort Collins where he went to college and works as a financial wellness consultant at KeyBank. He started looking for an apartment or house in the city to save himself the drive on what he called a "treacherous" stretch of Colorado Highway 14 east to Ault.

"Rent was $1,450 for something that would be in a nice area," Martinez said. And buying in Fort Collins? Well, that was impossible.

He looked at a one-bedroom, one-bathroom home on Mulberry on the market for $600,000. After that, "I thought buying was something I'd never be able to do on my own," he said.

But when returning to his grandparents' house after work every day, he knew the town was growing and Baessler Homes was the big player in town.

Its Conestoga neighborhood offered what he considered affordable new townhomes and single-family homes for less than most neighboring communities.

"Baessler was a game changer," Martinez said.

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In January, he closed on a two-bedroom, two-bath townhome with a two-car garage for $224,050. The median sales price for a townhome in Fort Collins at the end of September was $360,000, about 60% higher than in Ault.

Living in a small town and driving 15 to 20 minutes — up to an hour in the evening rush — to work every day wasn't what Martinez had in mind, but it's a choice he was willing to make to have a home of his own.

"It's my little oasis," he said.

"I do in a sense miss Fort Collins," Martinez said. "I've lived in big cities and I do love going out for dinner." Living in Fort Collins, "I thought would be a little better but I love living in a small town. It's quiet. I can get from point A to point B without worrying about traffic. And, Fort Collins is only 15, 20 minutes away."

Baessler Homes has been building between 75 and 100 homes per year, CEO Steve Bricker said.

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Perks of places like Weld County

As home prices soared and people looked farther outside the population centers, "what used to be perceived as far really is not anymore," Bricker said.

When buyers started going to Wellington and Severance, Bricker said people would ask " 'You're doing what? You're buying in Wellington?' Now those towns are household names. Severance is now an extension of Windsor; Fort Collins and Wellington are interchangeable as is Windsor and Severance. We don't know yet what Ault is interchangeable with."

While smaller Weld County towns are hitting the attainability factor with lower home prices, the drive for more affordable homes is pushing demand and prices. Kersey's median price, for example, rose nearly 32% from September 2021 to this year. Sixteen homes in the small town of fewer than 2,000 residents were sold last year and 32 have been sold so far this year, sending the median sales price from $309,750 at this time last year to $408,000.

Bricker said the challenge is how these small towns continue to handle the growth because of the infrastructure needed and requirements imposed by the state.

Baessler only has about a year left in terms of lots available to bring to market in Ault, Bricker said. It is exploring other land to continue developing in Ault.

"We've definitely been welcomed here. We're definitely able to supply homes to some of these areas just outside" of major population centers, especially along transportation corridors like Interstate 25 and U.S. Highway 85.

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Becky Minnick, president of the Cheyenne Board of Realtors, said Wyoming's capital city is seeing a lot of people coming from out of state, including Northern Colorado, looking for more affordable housing.

The median sales price for a home within Cheyenne city limits at the end of September was $310,000; but outside the city, on a little bit of acreage, the median sales price was just below $500,000.

"We seem to be having people wanting their own space (on small or larger acreage)," she said. "They want space between them and their neighbors."

Rural property has definitely increased in appeal and there just aren't many available, Minnick said. "People can charge a premium."

She's seeing people from big cities and smaller towns fleeing their home states for the wide open spaces, relaxed gun laws and stricter regulations on marijuana sales and use, she said.

As Colorado tightens its gun laws "people keep coming here" to an open carry state. "People want that freedom to be able to do that."

During the pandemic when some people could work from anywhere, and racial unrest roiled in population centers like Denver, "we started seeing an influx of people from all over," she said. "We got a lot from Oregon and California wanting to get out of those metro areas."

"I heard of teachers from California coming to Wyoming because they were planning on staying virtual," Minnick said. "We definitely had a lot of people who don't have to report to work. As long as there's good internet, they don't care where they live. They don't have to be close to anything or worry about commuting."

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Low interest rates help, but down payments still a challenge

Home prices have gone up faster than income, but low interest rates are still helping buyers get more home for their money.

"The formula is still a challenge for mostly first-time homebuyers," Kendall said.

About 20% of the Northern Colorado market is first-time buyers whose "biggest challenge is not affordability in terms of payment, it's the down payment," he said. "With low interest rates they could own for less than they are paying in rent in some of these luxury apartments."

Sixty percent of the homebuying market is those who have owned homes and built up "about $11 trillion of equity. They don't have an affordability problem, they are sitting on massive amounts of equity. If they want to buy a house they really don't have much of a problem."

The remaining 20% are investors paying cash, Kendall said.

He doesn't anticipate a massive slowdown in home appreciation, but a rise in interest rates could slow the market.

"A lot of people refinanced their homes at low rates," he said. "If interest rates go to 4% or 5%, they will rationalize why would they want to move? That won't cause prices to go down, but it would help rebalance the market."

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Home prices in Northern Colorado cities and towns

Median single-family home prices, year to date through September

city, median price, percentage change year over year

Ault: $346,200 (2.43%)

Berthoud: $508,685 (13.1%)

Cheyenne, Wyoming: $310,000 (8%*)

Eaton: $434,000 (15.43%)

Evans: $354,000 (14.35%)

Fort Collins: $533,268 (17.2%)

Greeley: $380,000 (14.1%)

Johnstown: $455,000 (13.8%)

Kersey: $408,000 (31,72%)

LaSalle: $350,000 (4.48%)

Loveland: $445,000 (12.7%)

Mead: $489,739 (13.23%)

Milliken: $405,268 (15.79%)

Pierce: $486,750 (31,55%)

Wellington: $424,439 (12.9%)

Windsor: $510,000 (11.2%)

Severance: $440,912 (19.8%)

Timnath: $572,089 (6.7%)

* Median sales price within city limits; median sales price in the rural areas outside Cheyenne are approaching $500,000.

How long homes are staying on the market

Single-family homes, year-to date-through September

city, days on market, percentage change year over year

Berthoud: 74 (-2.6%)

Fort Collins: 35 (35.2% )

Greeley: 35 (-30%)

Johnstown: 31 (-39.2%)

Loveland: 37 (-33.9%)

Wellington: 65 (-18.8%)

Windsor: 57 (-26%)

Severance: 84 (unchanged)

Timnath: 88 (-36.2%)

Pat Ferrier is a senior reporter covering business, health care and growth issues in Northern Colorado. Contact her at patferrier@coloradoan.com.

This article originally appeared on Fort Collins Coloradoan: Fort Collins housing: Affordability pushing buyers into Weld County