If you’re looking at renting an apartment in Denver, Colorado, you may have to shell out more money than you thought. A recent rental market analysis shows that the average monthly rental rate for an apartment in Denver is $1,048–an increase of about 6.3 percent.
However, this recent spike in rent isn’t new to the city’s residents. Renters in parts of the suburb Littleton saw rent prices increase by about 13.4 percent in 2010, and those in southeastern Denver near Northglenn and Thornton saw rates rise by about 9.7 percent. The average rate in Denver peaked in 2001, according to Ryan McMaken, an economist for the Colorado Division of Housing. But now rent levels are rising back to their former peak period.
The increase in rental rates isn’t due to a lack of availability. The metro vacancy rate rose to 4.4 percent during the third quarter of 2013, up from 2012’s third-quarter rate of 4.3 percent. As new apartments are completed, experts predict a slight moderation in rent growth in the next few years. A significant number of apartments will open up in 2014, and that may have a slight impact on vacancy rates.
The reason for the sudden increase in rent in Denver could be due to the types of apartments being built. Ron Throupe, associate professor at the University of Denver’s Daniels College of Business, explained that the new units being constructed are high-end apartments made for young, high income professionals who are looking to make the move to Denver for its employment opportunities. Therefore, the monthly rent is expected to continue to increase.