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.

National Economic News

The nation's retailers reported their results for July, with sales falling below expectations. (The Denver Post, August 5, 2005).

The Labor Department announced the largest growth in hiring in 3 months, with 207,000 new jobs across a range of industries. (The Rocky Mountain News, August 6, 2005).

The Federal Reserve Board raised short-term interest rates by a quarter of a point on August 9. This was the 10th increase in 14 months in the Feds quest to contain inflation. (The Denver Post, August 10, 2005).

The Labor Department reported that nationwide productivity rose at 2.2 percent in the second quarter of 2005. (The Denver Post, August 10, 2005).

Soaring oil prices throughout the month of August, served to keep the stock market indexes muted, with marginal increases by the end of the month. (The Denver Post, August 11, 2005).

Nationwide, sales of previously owned homes fell in July, but the sales pace was still the third-highest ever. (The Denver Post, August 24, 2005).

Regional Economic News

The Labor Department reported that increasing energy prices fueled inflation in the metro Denver area during the first six months of the year. (The Denver Post, August 17, 2005).

In August, the median price of single family homes in the Denver metro area hit a record high of $255,000. Condo prices dipped slightly to $162,499. (The Denver Post, August 24, 2005).

Colorado's unemployment rate dropped again to 5.0% in August 2005. This is down from the 5.5% in August 2004. Boulder County's rate dropped from 4.6% in July to 4.3% in August. Broomfield County's rate also dropped from 4.7% in July to 4.2% last month.

The following information comes from the Daily Camera, August 1, 2005.

The local rental market continues to throw us curves. The early peak season showed a very positive trend for owners and landlords. Rents were up slightly and demand was higher than in recent years. However, by mid-July this trend was showing signs of slowing. Many property managers were seeing rents come back down as the number of showings to get leases were increasing again.

Now that we are past the peak, July to Labor Day, season we are still seeing strange trends. Normally, at this time of year the vacancy rate is dropping. However, as you can see from the chart, the number of advertised rentals is going up. One reason for this may be the soft student rental market. These rentals do not generally appear in the local newspaper. They are usually found in the Colorado Daily which targets the student market. Since the student rental market is very soft these vacancies may account for the sharp increase in the number of residential rentals in the Daily Camera.

The market is still very much a renter's market. Most rents are still flat in most areas and attracting tenants is still a challenge. We will have to see how the overall market fairs for 2005.

The student rental market continues to be very soft. Historically, many of these rentals are pre-leased in the Spring. This season, many students elected to wait until late summer and fall before even beginning their searches. This meant the rents were down significantly from last year in many rentals. In a renter's market this works to the student's advantage. If the market returns to normal (next year?) this strategy will backfire on the students as vacancy rates will be down, rents will be back up and the only available properties will those less than desirable. How soon will we see the turn around? It is anybody's guess at this point. Last spring rents were up and demand was high for a short time.

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.