Click here for the released of section I.
Click here for the released portion of section II.
Apartment vacancies in the Denver metro area fell again in the third quarter, dropping to 5.3 percent. According to a report released Wednesday by the Apartment Association of Metro Denver and the Colorado Division of Housing, apartment vacancy rates fell to the lowest rate reported since the third quarter of 2007, falling from 2010’s second-quarter rate of 6.1 percent. The vacancy rate also fell from last year’s third-quarter rate of 7.4 percent. The metro-wide vacancy rate has now fallen for three quarters in a row.
In the past, demand for apartments has tracked closely with job creation, but in recent quarters, demand has been strong in spite of job losses.
Vacancy rates had initially increased following the rapid increase in the unemployment rate in late 2008 and early 2009, rising to 9.0 percent. But the vacancy rate quickly fell below eight percent by the end of 2009, and is now at a three-year low. The last time the metro-wide vacancy rate fell below 5.3 percent was during the first quarter of 2001.
Rents increased for the third quarter in a row as the metro-wide average rent increased from $880.99 to $912.68, or 3.6 percent, from the third-quarter of 2009 to the same period this year. All counties in the metro area reported year-over-year increases in average rents. At 3.6 percent, growth in rents outpaced the most recent Consumer Price Index increase for the Denver area which was 1.7 percent for the first half of 2010.
Tenants continue to see few wage increases, however, and this presents challenges for owners seeking rent increases.
Rental losses due to concessions, discounts and delinquencies rose to 13.6 percent during the third quarter of this year, rising from 10.8 percent during the third quarter of last year. Rental losses are at the highest level experienced since the first quarter of 2007 when rental losses were 14.3 percent of gross rents.
For 2010’s third quarter, the highest vacancy rates were found in Arapahoe County where rates fell year-over-year from 8.5 percent to 6.7 percent. Rates were lowest in the Boulder/Broomfield area where vacancies fell year-over-year from 5.5 percent to 3.5 percent. With the exception of Douglas County, vacancy rates fell in all metro Denver counties from the third quarter of 2009 to the same period this year. The vacancy rate in Douglas County increased slightly year over year from 4.3 percent to 4.4 percent.
2010’s first quarter vacancy rates by county were Adams, 4.4; Arapahoe, 6.7; Boulder/Broomfield, 3.5; Denver, 5.3; Douglas, 4.4; Jefferson, 3.9.
Average rents for all counties were: Adams, $914.71; Arapahoe, $881.97; Boulder/Broomfield, $993.25; Denver, $905.01; Douglas, $1112.52; and Jefferson, $863.99.
The Vacancy and Rent Surveys are a service provided by the Apartment Association of Metro Denver and the Colorado Department of Local Affairs’ Division of Housing to renters and the multi-family housing industry on a quarterly basis. The Colorado Vacancy and Rent Survey reports averages and, as a result, there are often differences in rental and vacancy rates by size, location, age of building, and apartment type. The full Report is available through the Apartment Association of Metro Denver at www.aamdhq.org; and limited information is available online at the Division of Housing web site: http://dola.colorado.gov/cdh/