NEWS

Vacancies rise in home rentals

Date: Mar. 20th, 2009
Contact: Margaret Jackson - Denver Post

Adams County had the highest jump in the fourth quarter of 2008. Foreclosed properties get some of the blame.


Vacant single-family rentals in metro Denver surged to a three-year high last quarter, the result of investors tossing foreclosed properties into the pool, according to a state report and industry experts.

The area's vacancy rate rose to 4.9 percent for the fourth quarter last year, up from 3.3 percent for the same period in 2007, according to a report released Thursday by the Colorado Department of Local Affairs' Division of Housing.

The rate was 5.5 percent during the fourth quarter of 2006.

Owners opting to rent their homes rather than sell in a dismal market contributed to the increase, said Susan Melton of Assured Management.

The lowest overall vacancy rates were in Douglas County and the Boulder/Broomfield area — at 3.4 percent and 3.9 percent, respectively. The highest, 7.4 percent, was in Adams County, the report shows.

"The (U.S.) 36 corridor has been very strong in terms of employment, new technology, government agencies expanding and wind and energy companies," said Gordon Von Stroh, management professor at the University of Denver Daniels College of Business.

Vacancy rates in other counties: Denver, 5.3 percent; Jefferson, 4.8 percent; Arapahoe, 4.1 percent.

Average rent metro-wide in the fourth quarter increased to $995, up from $966 a year earlier. Rents were highest in the Boulder/Broomfield area at $1,454, and lowest in Denver at $921. All counties but Adams reported increases in average rents in the fourth quarter of 2008 compared with the year before.

Average rents for other counties: Douglas, $1,409; Adams, $1,036; Arapahoe and Jefferson, $983.

The single-family renter's market is likely to remain soft, experts say.

"During the first quarter of '09, the vacancy rate will have gone up again and days on market will have gone up," said Bob Alldredege of Jericho Properties. "The market is going back toward a renters market."

Margaret Jackson: 303-954-1473 or mjackson@denverpost.com

Fluctuating fourth

Changes in the metro area's single- family rental vacancy rate in the fourth quarter the past three years:

4.9% 2008

3.3% 2007

5.5% 2006

Source: Colorado Department of Local Affairs' Division of Housing