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. It is issued during the first week of the month. 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 News

Personalized Management Services has a new website, with lots of new functionality. The address remains the same - please check it out at www.persmgt.com

Happy Holidays

We'd like to wish you all a wonderful holiday season.

National Economic News

Things continue to look up on the jobs front. Nationally, companies created almos 300,000 new jobs in the past three months, outpacing forecasts and ending a six month slump. (The Rocky Mountain News, Nov. 8, 2003) This is a net gain of 126,000 jobs (Boulder County Business Report Nov 28 - Dec 11, 2003) The Treasury Secretary, John Snow, cited growth in jobs, factory activity and home purchases as proof of the strengthening economy. (Denver Post, Nov. 12, 2003) Correspondingly, the Commerce Department reported that business inventories rose in September for the first time in six months, indicating that companies are feeling more optimistic. (Denver Post, Nov. 18, 2003)

Regional Economic News

Although improving, the Denver economy is not matching the gains made nationally. The Denver area added 1,600 new jobs in September, as the unemployment rate declined for the third month in a row. In addition, 25% of local companies planned to increase hiring in the fourth quarter, as opposed to 15 percent in the third quarter. Only 2% of companies planned layoffs, a decrease of 20% in the third quarter. (Denver Post, Nov. 6, 2003).

However, according to the Boulder County Business Report (BCBR Nov 28 - Dec 11, 2003) Colorado's unemployment rate dropped from 5.7% to 5.6%. Other regianal rates appear in the table.

Colorado now leads the nation in growth in bankruptcies. Filings through the end of September were an increase over the same period in 2002 by 24 percent. (The Rocky Mountain News, Nov. 15, 2003)

Denver's home-building permits are down 18 percent as compared to a year ago, slowing in conjunction with the drop in sales. The few areas where permits are ahead of last year are Boulder, Erie, and Commerce City. (Denver Post, Nov. 14, 2003)

The commercial market still has a number of vacancies in the area. Unofficial estimates show the Metro area still has a 30% overall vacancy rate. The Interlocken area in Broomfield is still showing a 40% vacancy rate.

According to local sources (Denver Post 12/4/2003) there is some improvment in the local rental markets. Statewide the vacancy rate dropped from 11.6% to 11.1% in the third quarter. Although an improvement this is still higher than the 9.1% vacancy rate in 3Qtr 2002. This compares to historical vacancy rates (non-student) at around 1-2% in the Boulder area. Overall there are positive signs for the area. For example, the vacancy rate in Loveland dropped to 9.9% from 29% a year ago.

Our statistics

• Student rentals......... 0% (The new apartment complex at CU reported a 2% vacancy rate)
• Non-student homes....... 3.5% (properties managed longer than 6 months
• Non-student homes....... 7.0% (properties managed less than 6 months)

There are still the same factors impacting the rental market:

• Fewer jobs in the area (leading to fewer prospective tenants coming to the area)
• More single family homes on the market (generally from those people that do not wish to sell or cannot sell for some reason)
• More apartments on the market (some developers are still building!)
• Interest rates still down (they can buy instead of rent)

We are still seeing people looking for places to rent but it is still very competitive. Price is the most important factor in our informal surveys. Second to price is location. Prospective tenants can virtually pick the area in which they want to live and have several selections.

City of Boulder: Snow Removal Regulations

The City of Boulder regulations require that sidewalks are cleared of snow by noon of the day after a snowfall. Residents are responsible to shovel the sidewalks and can be fined if they don't do so. Violators receive one warning per season, with a summons issued for the next violation. First time violators recieve $100 fines. In the year 2002, 863 snow removal violations tickets were issued.

City of Boulder: Accumulated Newspapers

Another potential code violation that tenants and owners must beware of involves the accumulation of newspapers. City code requires removal of the newspapers when they are visible to the public. No newspaper or periodical can be more than three days old.

City of Boulder: Interest on Security Deposit Issue

The Boulder City Council will conduct the next review of the proposed ordinance in December. The meeting will be publicized as soon as it is scheduled. The language supported by the BCAA for the ordinance is as follows:

"Interest rates paid upon the refund of security deposits shall be determined by the city manager by averaging the interest rates being paid on one-year certificates of deposit by three banks doing business within the city that, in the view of the manager, provide indicia of being significant participants in the local banking industry. This average rate will be calculated as of December 15 of each year, or if that date falls on a weekend or holiday, the first business day thereafter. The manager's determinations of the rate shall be final. The rate shall be published in a newspaper of general circulation or posted on a city internet site that is accessible to members of the general public. The average interest rate so determined shall be rounded to more than two decimal points. It shall be come the rate of interest paid on any security deposit that is refunded during the calendar year starting on January 1 of the year immediately following the date of the manager's decision."

Send us Your Questions and Referrals

What is a competitive rent for your property? There is no one answer for everyone. We will be working with each of our clients to determine how their property should be priced in this market. Please contact us if you have specific questions or want more information.

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.

Please take care!

Ray, Scott, Kathy, Kim and Frank