Rents on the rise the market in the West is improving. It is being driven by the increases in interest rates and more jobs. According to the Daily Camera (4/20/06) the average rent in 20 western markets is up about 4%. the biggest increases were along the West Coast markets. However, while the Denver market is improving, rents are only up only about 0.7%. In addition, landlords are seeing some improvements as interest rates climb and fewer people can afford to buy homes.
Vacancies are going down In the Denver Post (4/28/06) the apartment vacancy rates for the first quarter were the lowest in 5 years across most of the Metro Denver counties. The overall vacancy rate dropped to 7.4% the fist quarter from 7.9% the 4th quarter 2005. The last time the vacancy rates dropped below 7% was in 3qtr 2001.
The vacancy rate in the Boulder/Broomfield counties was actually down to 6.9%, the lowest across 6 county markets. Most analysts still have concerns about the very high foreclosure rates and that developers are still bringing more units to the market. However, many developers are holding off due to the high costs of construction as a result of last year's hurricanes and increasing land prices.
Commentary
We are seeing an increase from last year in the number of tenants looking for properties. While it is still a renter's market overall, this does show a good trend for landlords. Some rents, particularly in the Boulder area, are up slightly. However, many property managers are holding rents static to lock in tenants before the typical July/August rush. Overall, we see the market continuing to improve--just not as fast as any of us would like.
