All those construction cranes muddling your view of the Rockies and Colorado’s bluebird skies might finally be paying off. According to Abodo.com, a multi-city apartment-finder service, the average rent in Denver has fallen by 7 percent just in the last month or so—the sixth steepest decline nationally.
The company’s data is part of the latest edition of its National Apartment Report, which tracks rental rates nationwide. In contrast to Denver, Colorado Springs had the fifth-largest increase in rents over the past month, rising by 13 percent. (It could be worse, like San Jose, California, where rents skyrocketed by a barely conceivable 28 percent.) These fluctuations are largely attributable to (possibly) temporary changes in supply and demand. At least the Springs is still affordable, though, with the average rent for a one-bedroom apartment costing $880, whereas Denver’s average is closer to $1400 per month.
The portion of renters nationally rose from 31 percent to 37 percent between 2005 and 2015, thanks largely to the Great Recession and its aftershocks. Here in Denver, recovery from that economic setback, explosive population growth, and a dearth of new condominiums and single-family homes have combined to make our rental market more competitive than ever. Our average home prices have increased by 13.4 percent since 2012, third best in the United States, but there are fears that this upswing is artificial and/or temporary given that our for-sale housing inventory is historically low.
You don’t need to spend more than a few minutes in Denver to recognize that new apartment complexes are popping up just about everywhere, and there’s no end in sight to such construction. As these buildings come online, basic economics dictates that they’ll provide much-needed relief for cash-strapped renters. While the trend is good news for those folks, the underlying fundamentals in Denver’s overall housing market remain volatile and fragile. Hopefully this delicate balance we’ve struck between accommodating growth and keeping housing prices at relatively sane levels won’t result in yet another housing bubble.
Follow 5280 editor-at-large Luc Hatlestad on Twitter at @LucHatlestad.
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