Colorado Apartment Vacancy Rate Hits 10 Year Low
Denver Business Journal 8-16-11
Colorado apartment vacancy rate hits 10 -year low; rents up 2%
Denver Business Journal -by Dennis Huspeni
Vacancy rates for Colorado apartments continue their downward march, reaching the lowest level in the second quarter since 2001, according to a report Tuesday from the state Division of Housing. The combined vacancy rate for apartments in Colorado’s seven largest cities fell to 5.2 percent for the second quarter, the division’s latest Vacancy and Rent Survey shows.
That’s a 1 percentage point drop from the same quarter last year, and a decline from the 5.5 percent rate from the first quarter. That rate hasn’t been below 5.2 percent since the first quarter of 2001, when it was 4.3 percent.
“The state, in general, is an overall tighter market”, division spokesman Ryan McMaken said. “In certain places, it’s more obvious than others…. The Denver area and northern Colorado have some of the tightest markets right now, and not surprising, in those areas we’re also seeing some of the most sustained growth in rents in recent quarters.”
Apartment rents, meanwhile, creeped up 2 percent statewide from the second quarter in 2010, to $877. In Denver, the average rent was $915.
“Colorado in general has had good job growth… we’ve seen the new hospitals, Metrorail construction, and companies moving here due to the business friendly climate. ” said Terrance Hunt, principal at the Denver office of Apartment Realty Advisors Inc.
The University of Denver’s Gordon Von Stroh, report author and professor of business, said this trend should continue well into 2012. “So many apartment communities are literally full, down to 2 and 3 percent vacancy levels,” he said. “The ones that aren’t are those that are priced too high, don’t have a good community manager, or have management issues.” Hunt said investors are finding it’s a good time to buy those distressed properties, spruce them up, then raise the rents and fill them with renters.
“Buyers are finding there are amazing opportunities out there,” he said.
DHUSPENI@bizjournals.com / 303-803-9232
Filed Under: Apartment Market
