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.

The National Economy

Stocks ended the quarter in the negative range, impacted by rising oil prices and interest rates. (The Denver Post, Apr. 1, 2005).

The manufacturing sector grew at a slower pace for the third consecutive month in February, but economists remain confident that the sector is healthy. (The Denver Post, Mar. 2, 2005).

The Labor Department reported that 262,000 jobs were created in February, more that the 225,000 that were predicted. This was the greatest growth in four months. (The Rocky Mountain News, Mar. 5, 2005).

The Commerce department reported that orders placed with U.S. factories rose 0.2 percent in January on demand for paper, petroleum and electrical equipment. (The Rocky Mountain News, Mar. 5, 2005).

A Federal Reserve study reported that the economy continues to grow and improve. Employment conditions improved, sales were up and factories increased production in February. (The Denver Post, Mar. 10, 2005).

National rates on 30 year mortgages hit their highest levels in five months, due to rising interest rates. (The Denver Post, Mar. 13, 2005).

The Federal Reserve Board raised interest rates yet again on the concern that inflation poses a threat to the economy. (The Denver Post, Mar. 23, 2005).

1. S. new-home sales rose 9.4 percent in February, the largest increase in more than four years. Rising interest rates are causing some purchasers to rush to lock in a lower rate for their mortgages. (The Denver Post, Mar. 25, 2005).

The Regional Economy

Mortgage rates are rising, but lenders say that the improving Colorado economy and incentives from home builders will keep sales steady. (The Boulder County Business Report, Mar. 18-31, 2005).

The Colorado Department of Labor announced that 27,900 jobs were added in 2004, which was twice as many as initially estimated. (The Denver Post, Mar. 11, 2005).

Colorado gas prices hit record highs above $2.00 per gallon in March. (The Denver Post, Mar. 12, 2005).

Metro Denver home sales are up 55 percent this year over the same period last year. (The Denver Post, Mar. 23, 2005).

Personal incomes for Coloradans rose 4.3 percent last year, lagging much of the nation, but an improvement over the past three years. (The Denver Post, Mar. 29, 2005).

Metro mortgage foreclosures for the first three months of this year are up over 30 percent higher than the same period last year. (The Denver Post, Mar. 30, 2005).

The Local Economy

Accomodations and food service tax collections in Boulder increased 4.5 percent in 2004, indicating increased activity in terms of meetings and group market activity. (The Boulder County Business Report, Mar. 18-31, 2005)

Rentals April 2005

The general rental market is tough to pin down right now. Some areas are doing well and demand is picking up. Other areas, Longmont in particular, are still struggling with an over abundance of properties and lower demand.

Overall, we are seeing improvements. Looking at the chart we see a better indicator than for the last two years. In April 2002 there were about 542 advertised rentals (not including student rentals). In following Aprils we saw advertised rentals of 964 (2003), 958 (2004), and 688 in 2005. We are hoping this trend continues. Much will depend on the interest rates and job creation. As interest rates and available jobs increase we see a corresponding increase in the number of renters searching.

In other news, The Colorado Supreme Court upheld the current state statute on Feb. 28, 2005, ruling that landlords must return security deposits within 60 days after a tenant vacates or face paying triple the deposit amount. (The Denver Post, Mar. 1, 2005).

Boulder Student Rentals

This segment continues to be a challenge. The CU Housing Fair came and went and there are still a high number of available rentals on the market. There are several factors here (i.e., higher tuition, athletic scandals, being a party school, Ward Churchill, losing the President and AD, etc.) that seem to be causing a drop in applications for next year. Some estimates are the applications will be down 11% or more. So, unlike previous years, the rental process continues long past Spring Break.

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.