2022 first quarter Denver Metro Apartment Vacancy and Rent Report
Researchers at the University of Denver’s Daniels College of Business released the first quarter Denver Metro Apartment Vacancy and Rent report, which showed a resumption in rent growth and a level vacancy rate. The first quarter results show an increase of $56.94, up from $1,708.67 in the fourth quarter to $1,765.61 this quarter.
The average rent change year-over-year for first quarter 2022 versus 2021 came in at $222.02 ($1,765.61 versus $1,543.59).
“This yearly rent change is just over a 13% increase for the year as of April 10, 2021,” says report author Ron Throupe, associate professor of real estate at the Daniels College of Business. “They are consistent with the year over year change measured last quarter. These rent changes exceed reported consumer price index (CPI) changes, or any real estate related CPI index portion.”
The Metro Denver apartment market showed no measurable change in an overall quarterly vacancy rate from last quarter, at 4.3%. The year over year decrease of 1.2% from 5.5% illustrates that the demand for units in comparison to supply remains tight, and there are near historic lows in vacancy. Unit turnover is returning to seasonal expectations with the rate at 3.0% for the quarter, after last quarter at 2.9%, and the same as the year over year measurement of 3.0%.
Ron Throupe
The Denver Metro apartment market added 1,936 new units to inventory this quarter, resulting in a total inventory of 384,257 units. Absorption for the quarter was 2,393 units, outpacing new unit production, resulting in a net absorption of 457 units.
“These results are coming off last year 2021 where a record of 19,353 net units were absorbed,” Throupe says. “There is always a concern that new unit production will outpace demand, accented by the amount of visible growth on the Front Range over the last seven years. This phenomena has yet to occur as migration, job growth and limited homes for sale, has supported apartment demand.”
In a special topic this month, Throupe is also addressing mortgage rates. Mortgage rates increases accelerated this quarter and are now approximately 5.25% for a 30-year loan, compared to 3.25% at this time last year.
“This coupled with rising prices has heightened concern that housing affordability needs, which is always a concern for local governments, is about to overwhelm affordability programs,” Throupe says. “The mortgage rates rise coupled with the rising price of single-family homes, exemplifying inflationary pressures, is not expected to quickly subside. This inflationary period leaves no one untouched.”
The Denver Metro Area Apartment Vacancy and Rent Survey is conducted by the University of Denver’s Daniels College of Business and Colorado Economic and Management Associates. It’s published by the Apartment Association of Metro Denver.
For interviews with Ron Throupe, please contact Kristal Griffith at kristal.griffith@du.edu. To obtain a copy of the Denver Metro Area Apartment Vacancy and Rent Survey report, please contact Christopher Dean, vice president of communications for the Apartment Association of Metro Denver, at 303.329.3300, or visit www.aamdhq.org.
