Why is Colorado so expensive? (6 MUST READ Reasons)

Welcome to our website! In this article, we shall answer the question, why is Colorado so expensive to live in compared to other states in the US. The article starts with an introduction followed by reasons and in the end it discusses the famous things Colorado is known for. Read it through!

Reasons why Colorado is so expensive

Colorado is one of the most beautiful states in the United States, with stunning mountain views, lakes and rivers, and plenty of outdoor activities to enjoy.

With a history that dates back to 1876 when it became the 38th state admitted to the Union, Colorado has grown into an attractive destination for both tourists and those looking to make a permanent move.

However, one downside of living in Colorado is its high cost of living; below are the reasons why Colorado is so expensive.

Why is Colorado so Expensive?

1. High demand for housing

Colorado High demand for housing
Colorado High demand for housing

With the growing population of Colorado, the high demand for housing has become a major factor in why Colorado is one of the most expensive states in America. As more people flock to Colorado for its stunning landscapes and bustling cities, there is an increasing competition to secure affordable housing.

This competition has pushed up real estate prices significantly in recent years, causing many potential homebuyers to struggle when trying to purchase property within their budget.

Another contributing factor that has caused the average costs of living to rise over time is the popularity of certain areas such as Denver and Boulder.

These cities have seen a significant influx of people who are looking for jobs and a better quality of life. With this large influx comes an increased demand for housing which can often result in bidding wars between buyers driving up prices even further.

2. High State Tax Rates

Colorado has one of the high state tax rates in the nation. With this high rate, Colorado residents are feeling the pinch when it comes to their pocketbooks. The cost of living in this state is steadily rising which can make life difficult for those who live here.

State taxes are a major contributor to what makes Colorado so expensive. This means that individuals may end up paying more than they would if they lived in a state with lower taxes.

Not only do these taxes put pressure on budgets, but businesses also feel the squeeze as well due to having to pay higher wages and pass on costs associated with doing business in Colorado.

3. Cost of living

Colorado is one of the most expensive states to live in due to its high cost of living.  The cost of living in Colorado is 4% higher than the national average. This means that goods and services cost 8-9 percent more than they do on average in other parts of the country.

The main factors attributing to this high cost are housing costs, transportation costs, and health care costs.

Housing prices are rising quickly in Colorado due to an influx of new residents and a limited number of homes available for sale or rent; this has caused rent prices to increase significantly over the years across the state’s major cities such as Denver and Boulder.

Also Read // 5 Reasons why Atlanta is so expensive (Plus Things it’s known for)

4. Tourism & hospitality demand

Tourism makes Colorado expensive because it increases demand for housing, accommodations, retail space, and other services that come with a surge in visitors.

When people visit Colorado to take advantage of all that it has to offer from outdoor recreation to cultural attractions and events—it puts pressure on landlords who can raise their rent prices due to increased desirability among prospective tenants.

This causes competition for affordable housing which drives prices up even further as well as an increase in utility costs related to providing services such as electricity and water.

Additionally, higher hotel rates may be charged during peak tourist seasons or at popular attractions where hotels benefit from travellers’ desire to stay close by these vacation spots.

5. Natural disasters

Natural disasters, such as floods and wildfires, have made Colorado one of the most expensive states to live in. In recent years, natural disasters have taken a toll on both residents and businesses alike. Natural disasters can cause severe property damage and economic losses for communities in Colorado.

Flooding In Colorado

The increase in natural disasters has also led to an increase in insurance premiums for homeowners in Colorado. Homeowners must pay higher premiums than other states because of the increased risk posed by natural disasters like floods or wildfires.

This makes it more difficult for Coloradans to afford their homes since they must pay higher insurance costs. In addition, natural disasters often lead to road closures due to mud slides or flooding which can hurt businesses who rely on travel or tourism for income.

6. Limited availability of land

Colorado is known to be one of the most expensive states to live in. A significant factor contributing to this is the limited availability of land, making it an extremely sought-after commodity.

With a growing population and limited space, Colorado has become increasingly more competitive when it comes to acquiring land.

Furthermore, with the influx of people drawn to its natural beauty and wide range of outdoor activities, demand continues to rise with no signs of slowing down any time soon.

Related Article // 5 Reasons why Connecticut is so expensive (Plus Things it’s known for)

Famous Things Colorado is known for

a) Rocky Mountain National Park

Colorado’s Rocky Mountain National Park
Colorado’s Rocky Mountain National Park

Colorado is one of the most visited states in the United States, with millions of people coming to admire its stunning natural beauty every year. One of the main attractions in Colorado is Rocky Mountain National Park, a famous national park located in the northern part of the state.

This incredible park encompasses more than 265,000 acres and includes awe-inspiring mountains, rivers, and valleys that draw visitors from all over.

The park was first established in 1915 by President Woodrow Wilson and has been designated as both a National Monument and a World Biosphere Reserve due to its importance for protecting an array of ecosystems.

Visitors can enjoy activities such as hiking, camping, fishing, or even horseback riding while they explore this amazing landscape. With its snow-capped peaks and dramatic landscapes, it’s no wonder that Rocky Mountain National Park is one of Colorado’s most beloved attractions!

b) Gorgeous Landscapes

Colorado’s Gorgeous Landscapes
Colorado’s Gorgeous Landscapes

Colorado is a state known for its wide range of natural beauty and stunning landscapes. From the majestic Rocky Mountains to the incredible red rocks, Colorado is home to some of the most famous and gorgeous landscapes in the country.

The Rocky Mountains encompass much of the state; within their rolling peaks are valleys filled with evergreen trees, snow-capped mountains and crystal-clear alpine lakes.

A favorite destination for outdoor enthusiasts from all over, these ranges offer year-round adventure opportunities such as skiing, hiking and camping.

Red rocks also serve as a popular attraction in Colorado; visitors can explore colorful sandstone formations at Garden of Gods or take a drive along the winding Rim Rock Drive near Grand Junction.

Additionally, there are plenty of high mountain passes offering breath-taking views throughout the entire state.

c) The Great Outdoors

Colorado’s Great Outdoors
Colorado’s Great Outdoors

Colorado is known for its breath-taking views, pristine mountains, and expansive prairies. It’s one of the top destinations for outdoor enthusiasts looking to take in some of the most famous Great Outdoors in Colorado.

With cities like Denver being a hub for adventure-seekers, there are plenty of opportunities to explore the natural beauty that Colorado has to offer.

Whether you want to go camping, hiking, or fishing – there are activities available year-round no matter what type of adventurer you are. You can take a scenic drive through Rocky Mountain National Park or raft down roaring rapids at Browns Canyon National Monument.

The state also features many ski resorts where people can experience skiing and snowboarding during winter months in beautiful alpine settings. From biking trails to white water rafting trips – Colorado offers something special for everyone who wants to get out and enjoy the outdoors!

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d) Beer culture

Beer culture is a staple of Colorado life. With over 300 craft breweries, Colorado has become one of the most famous beer-producing states in the US.

The state’s thriving craft beer scene is attributed to its abundance of quality ingredients such as Rocky Mountain water and local hops, plus its passion for innovation and experimentation among brewers.

The spirit of collaboration among brewers encourages them to be creative and push their limits when creating new recipes. This leads to unique flavors and styles that have earned Colorado a reputation as the nation’s leader in craft brewing culture.

People from all over come to experience the state’s amazing selection of beers from pale ales to stouts, sours, lagers, IPAs, Belgian-style brews and more.

e) Rocky Mountain Oyster

Rocky Mountain Oyster
Rocky Mountain Oyster

Rocky Mountain Oysters is made from deep-fried bull testicles and can be found on menus across the state of Colorado. It’s a hearty dish that has been served in ranching communities in Colorado for centuries, and it is still popular today.

In recent years, more restaurants have been featuring Rocky Mountain Oysters as part of their signature dishes as interest in this unique food item has grown around the world.

Whether you’re visiting Colorado or live there permanently, sampling Rocky Mountain Oysters is an experience not to be missed – it’s a true taste of western cuisine that will stay with you long after your meal is over! Try the Rocky Mountain Oysters recipe


In conclusion, Colorado is a great place to live but it does come with some drawbacks. With its stunning natural beauty, abundance of outdoor activities, and booming economy, Colorado has become increasingly expensive for residents.

While this rising cost of living can be seen as a downside, many find that the benefits outweigh the costs.