This newsletter is a compilation of news and information regarding the rental markets in Boulder and Broomfield counties and the economic status of and outlook for the area. The sources for the data include local and regional news media, association publications and seminars, and information gathered from contacts in the property management and real estate fields. We make every effort to cite all of our sources. Should we miss one please let us know so that we can correct the omission.

Company update

Personalized Management Services has outgrown the home office and the business will be moving in the very near future?possibly as early as next month! We are negotiating for office space in east Boulder. As soon as we get settled in we will send out the change of address information and invitations to our open house.

We will also be looking for a full time receptionist to help respond to the calls from our clients and tenants. If you know of someone looking for such a position please let us know. We would prefer someone that can speak fluent Spanish.

Please also note we have a satellite office in Louisville to serve the east Boulder and Broomfield counties. The direct number for Kathy is 303.666.1111.

Have a question?

If you have a specific question about the rental market, a specific property, or property management in general please let us know. We will get that information to you and may include it in future newsletters.

Send us your referrals

We are actively working to grow the business and to add new properties to our management inventory. If you know someone that would be interested in our services please send them our way. We pay referral fees to anyone referring us business!

That wraps things up for this month. Again, if you do not want to receive these messages please call or email us and we will take you off this mailing list.

The number of homes for sale in the Denver metro area set a record in the month of May, with an all-time high of 26,103 homes available. The median home prices also hit a new record, with the average price of a single-family home in Denver at $275,879, which is up 2.6% from May 2002. The average price for a condo also rose comparably to $174,382. (Denver Post, May 28, 2002).

In May, home mortgage rates dropped for the eighth time this year, bringing them down to lows not seen in 40 years. The rates are fueling large numbers of refinances and allowing new homeowners to enter the field. The low rates are also serving to keep home prices elevated. (Rocky Mountain News, May 30, 2003).

In April, the Colorado unemployment rate jumped up 0.3 percent to 6.0%, which is its highest level in more than ten years. This was the biggest monthly increase in over a year. According to the Colorado Department of Labor and Employment, there were 147,200 Coloradoans looking for jobs in April. (Rocky Mountain News, May 31, 2003).

The Commerce Department reported that correspondingly, consumers who are worried about jobs reduced their spending in April by 0.1 percent. Consumer spending was forecasted to increase. (Rocky Mountain News, May 31, 2003).

There are signs that the economy is starting to improve, with the Dow and NASDAQ moving up and manufacturing indexes also starting to inch upward. Colorado regional stock performance for the period of April 28-May 12 was led by Vitesse Semiconductor, Carrier Access Corp., Sun Microsystems, Lightbridge, and Array Biopharma. (Boulder County Business Report, May 16, 2003).

The largest employers in Boulder and Broomfield counties are a familiar group, as can be seen in the attached table that lists the top ten in number of employees. (Boulder County Business Report, May 2, 2003).

Employer - # Employees

• IBM Corp. - 4,800
• Sun Microsystems, Inc. - 3,300
• Ball Corp. - 2,500
• Boulder Community Hospital - 2,300
• Storage Technology Corp. - 2,000
• Level 3 Communications Inc. - 1,800
• ConAgra Foods Longmont - 1,200
• Longmont United Hospital - 1,148
• Seagate Technology LLC - 1,080
• Valleylab Inc. - 950

Although there are indications manufacturing is up there are no strong indications the companies will significantly increase hiring in the near future.

The commercial rental market continues to be very challenging?perhaps more so than the residential market. The exodus of high tech businesses from Colorado continues to leave behind vacant office space that once would have been considered prime.

In the past we have provided commercial vacancy rates. Since our last newsletter the group(s) collecting this information have ceased their collection efforts. If we can locate another source, or sources, we will again provide this information.

The residential rental market continues to be a renters market, with many choices available and potential renters making their decisions based upon price. Our chart below shows the number of advertised rentals up about 235% from June 2002. There is continuing pressure to lower rents.

The areas easiest to rent right now are those closest to downtown and/or shopping areas. This is true in all the municipalities in Boulder and Broomfield counties.

Another factor yet to realized in the Boulder city rental market is the 500 beds at the new apartments on the University of Colorado. These will be full apartments with kitchens. As mentioned in a previous newsletter these will be strictly for upper level and graduate students and doctoral candidates. The apartments are offering studios, one bedrooms, two bedrooms, and two bedrooms for 4 people.

Last night the Boulder City Council passed changes to the enforcement of rental ordinances. We have not seen the actual text of the changes but the Boulder County Apartment Association representative gave us the following summary.

The Council directed the enforcement groups to meet with the rental property owners and/or property managers when a there is a suspicion of a violation. We actually experienced this with one of our properties earlier this year. There was a complaint from a neighbor and we received notice that the property could be in violation of the occupancy ordinance. These violations can carry a $2,000/day fine. We met with the City inspector and were able to show them we were actively managing the property and there was no evidence of a violation. This example was a critical part in convincing the Council to make the changes.

As we get more detailed information we will pass this along to all of you.

State Farm Insurance is implementing an inspection program that will identify customers in wildfire-prone areas who have property with brush and trees that may contribute to a fire threat. Those customers will have a period in which they must clean up the property, or otherwise they will lose their coverage. The area in which State Farm is implementing this policy includes Boulder County. (Denver Post, May 20, 2003).

We expect other insurance companies to follow their lead.