Are condominium builders hitting the accelerator as a cliff of demand approaches or are they merely attempting to maintain up in a housing market that continues to defy expectations?
Metro Denver ought to see one other 12,000 flats come available on the market in 2018, persevering with a protracted and unprecedented streak of multi-family development, mentioned Greg Willett, chief economist with RealPage, an actual property expertise and analytics agency.
Builders delivered 10,854 new flats in metro Denver final yr, and tenants soaked up 10,201 of them, conserving the occupancy charge steady at 94.three %, in response to RealPage.
RealPage estimates condominium rents in metro Denver rose three.2 % in 2017, the 15th-fastest acquire within the nation and forward of the U.S. acquire of two.5 %. The corporate places the standard month-to-month hire at $1,404 in metro Denver.
The brand new provide ought to hold landlords and managers busy attracting tenants and in addition dampen any hire spikes.
“It might be powerful for property house owners and operators to push rents a lot within the neighborhoods that can get essentially the most new product, together with the city core,” Willett mentioned.
General, U.S. condominium rents climbed a modest 2.5 % in 2017 to $1,330, in response to RealPage. As is normally the case within the fourth quarter, landlords boosted reductions to draw tenants.
“Whereas the condominium hire progress tempo has slowed from the efficiency seen a pair years in the past, it’s the longevity of the present cycle that’s so spectacular,” Willett mentioned.
Abodo, an apartment-finding service, estimates the median one-bedroom condominium hire statewide topped $1,000 final yr. Abodo places the median hire for a one-bedroom Denver condominium listed on its website in January at $1,476, and $1,843 for a two-bedroom unit.
Condo rents nationally have risen for eight consecutive years, however the charge of enhance has slowed. Sacramento, Calif., at 6.5 %, Las Vegas at 5.6 %, and Jacksonville, Fla., at 5.three %, had been the metro areas with the largest good points in rents final yr, in response to RealPage.
Two years in the past, Portland, Ore., led the nation with a 12-percent acquire in rents. Final yr, rents there climbed a modest 1.9 %. Condo rents rose lower than 1 % in Kansas Metropolis, Mo.; Nashville; San Antonio; Pittsburgh; West Palm Seaside, Fla.; and Washington, D.C. Austin, as soon as a sizzling market, suffered a zero.four % decline in condominium rents.