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 Picture

The Labor Department announced that the U.S. unemployment rate fell to 4.7 percent in January, its lowest rate in more than four years. (The Rocky Mountain News, February 4, 2006).

Home prices in Denver rose 4.2 percent over January of 2005. Prices were flat compared with December, signaling a shift to a buyer's market. The median price for a single family home in Denver is $245,000. (The Denver Post, February 10, 2006).

The Dow rose above 11,000 in February, pushed upward by better-than-expected retail sales figures for January and a drop in crude oil prices. The Commerce Department reported that retail sales rose 2.3 percent in January, beating the forecast of 9.9 percent and notching the biggest rise since May 2004. (The Denver Post, February 15, 2006).

Construction of new homes nationwide rose in January at their highest pace in more than 30 years. The Commerce Department reported that building activity was up 14.5 percent in January as compared with December. (The Denver Post, February 17, 2006).

Economic indicators monitored by the Conference Board, a private research group, rose sharply in January, indicating robust growth in the Spring. (The Denver Post, February 22, 2006).

Consumer prices rose in January at their highest rate in 4 months, fueled by rising encergy costs. (The Denver Post, February 23, 2006).

Across the U.S., new homes sat unsold at record levels, despite the warmest January in over 100 years. The Commerce Department reported that sales of new single-family homes fell by 5 percent in January--the slowest pace since January 2005 and leaving a record of 528,000 new homes unsold. (The Denver Post, February 28, 2006).

On the last day of the month of February, the Dow Jones Industrial Average fell by more than 100 points, due to a comination of investment concerns: weakness in homes sales, consumer confidence and manufacturing. (The Denver Post, March 1, 2006).

Local Economic Picture

The market is changing. As you can see from the chart above we are still seeing a more normal number of rental properties on the market for this time of year. The number of advertised rentals is more in line with the numbers back in March 2003. These numbers were significantly higher in 2004 & 2005. The improving trend continues.

We are also seeing some of the recent rentals leave the market altogether. Our theory is that some of the owners of these properties are now taking their houses off the market and putting them up for sale. If this is the case, this is good news for the rental market. Lower numbers of rentals means it will be easier to rent and that rents will begin to increase again.

However, it remains to be seen what the real estate sales market will do and how that will eventually affect the rental market. We should start seeing the these effects by early May. Until then we will all keep our fingers crossed for the 2006 rental season.

Important The City is considering increasing the responsibility of the landlord and agent for the acts of our tenants. They are talking about being able to recind our rental licenses if our tenants incur citations for noise, trash, snow removal, etc.

Please contact the City Council and let them know we should not be held accountable for others actions. You can reach them at council@ci.Boulder.co.us using email.

Student Fall Pre-Leasing Season The season is well underway and signs are looking up. Although we are not seeing many rents increase, we are seeing a larger number of students looking at available rentals. This year the 4 bedrooms went early and now, just before Spring Break, the 2 & 3 bedrooms are getting increased activity. The one bedrooms are still not moving much but we expect these to hit their high point in the weeks following the 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.