Can you say "hot"?
As noted in my article "Complex Equation" last week, the apartment market is booming these days. And it doesn't look to be slowing down. It was just announced that Colorado Springs apartment rents hit an all-time high in the third quarter of 2011. Average rent is now $778 a month. Ouch.
Colorado Springs apartment rents hit all-time high, climb 6.7 percent
The average rent in the Colorado Springs metro area hit a new high during the third quarter of 2011, climbing 6.7 percent, year over year, to $778. According to a new report on apartment rents and vacancies, released today by the Colorado Division of Housing and the Apartment Association of Southern Colorado, the average rent for the region was up from $729 reported during the third quarter of 2010, and was up from 2011’s second-quarter average rent of $759.
The median rent also hit an all-time high of $752 during the third quarter, rising 7.4 percent from 2010’s third-quarter median rent of $700.
The average rent increased in all types of apartments measured, including all types of units from efficiency apartments to three-bedroom apartments.
The average rent also increased in all sub-markets measured during the third quarter except in Northeast Colorado Springs where the average rent dropped from $749 to $741, year over year. The average rent in the Southeast region of Colorado Springs, on the other hand, increased 87 dollars from $605 during last year’s third quarter, to $692 during the same period this year.
“This is some of the most solid rent growth we’ve seen in years, said Ron Throupe, an assistant professor of business at the University of Denver, and the report’s author. “The third quarter showed the largest year-over-year increase in the metro-wide rent in ten years, and it was also the seventh quarter in a row for year-over-year growth.”
Average rents for all market areas were: Northwest, $849; Northeast, $741; Far Northeast, $909, Southeast, $692; Security/Widefield/Fountain, $613; Southwest, $790; Central, $718.
The apartment vacancy rate in the Colorado Springs metro area fell to 6.2 percent during the third quarter of 2011, falling from 2010’s third-quarter vacancy rate of 6.6 percent. The third-quarter rate also fell from this year’s second-quarter rate which was 6.4 percent.
The vacancy rate declined in the Northeast, Southeast, Security/Widefield/Fountain and Southwest areas of Colorado Springs, while the vacancy rate increased in the Northwest, Far Northeast, and Central areas.
“The vacancy rate is at the second-lowest rate recorded in the last ten years, and it’s the lowest third-quarter vacancy rate since 2001,” said Ryan McMaken, a spokesman for the Colorado Division of Housing. “A lack of new multifamily construction in recent years is likely to encourage the rate to fall even more, but it looks like the industry is beginning to respond. Given the rent growth, it’s not surprising that El Paso County is among the counties with the most new multifamily building permits issued this year.”
Vacancy rates for all market areas were: Northwest, 5.6 percent; Northeast, 4.6 percent; Far Northeast, 7.1 percent, Southeast, 8.0 percent; Security/Widefield/Fountain, 10.7 percent; Southwest, 5.6 percent; Central, 6.2 percent.
Apartment Realty Advisors is also a major sponsor of this report. The Vacancy and Rent Surveys are a service provided by the Colorado Department of Local Affairs’ Colorado Division of Housing and the Apartment Association of Southern Colorado to renters and the multi-family housing industry on a quarterly basis. The Colorado Springs Area Vacancy and Rent Survey reports averages and, as a result, there are often differences in rental and vacancy rates by size, location, age of building, and apartment type. For more information, please see the Division of Housing’s economics blog at www.divisionofhousing.com.
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