Tuesday, May 24, 2011

Single-family rental vacancies at all-time low of 1.4 percent

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Vacancies in for-rent condos, single-family homes, and other small properties across metro Denver fell from the first quarter of 2010 to a new low of 1.4 percent during 2011’s first quarter. According to a report released Tuesday by the Colorado Division of Housing, the vacancy rate was 3.1 percent during the first quarter of 2010, and was 2.0 percent during the fourth quarter of 2010.

The average number of days on the market for single-family rentals and similar properties fell from 45.1 days during the first quarter of 2010 to 29.7 days during the first quarter of 2011. The number of days on the market also fell from 2010’s fourth-quarter average of 38.2 days.

“Both the vacancy rate and the number of days on the market are at the lowest levels recorded since 2001,” said Ryan McMaken a spokesman for the Division of Housing. “There has been concern about the potential supply of unwanted and foreclosed single-family homes out there, but this data continues to suggest that there is a solid demand for single-family homes and condos that have been made available for rent.”

At the county level, the lowest vacancy rates were found in Jefferson County and in the Boulder/Broomfield area. The vacancy rate was 1.0 percent in Jefferson County, and there were no vacancies among the units surveyed in Boulder County.

The highest county-wide vacancy rate, found in Adams County, was 1.9 percent.

Vacancy rates for all counties surveyed were: Adams, 1.9 percent; Arapahoe, 1.8 percent; Boulder/Broomfield, 0.0 percent; Denver, 1.3 percent; Douglas, 1.1 percent; and Jefferson, 1.0 percent.

Average rents were largely flat across the metro area during the past year in spite of declining vacancies.

The average rent for single-family and similar properties rose year-over-year to $1,039 during 2011’s first quarter, rising 0.4 percent from 2010’s first-quarter rate of $1035. The first quarter’s average rent was up 0.6 percent from 2010’s fourth-quarter average rent of $1029. Average rents are not adjusted for inflation.

“Although the demand for units is very strong, it has been difficult for owners to push rents in many cases,” McMaken said. “This is partly due to the fact that new inventory continues to come in the form of foreclosed homes bought up by investors and via owners who opt to rent out their homes instead of selling them in the present market. Present trends point toward more solid rent increases in the future, however.”

Median rents for all counties were: Adams, $1104; Arapahoe, $1016; Boulder/Broomfield, $1535; Denver, $982; Douglas, $1386; and Jefferson, $993.