DENVER, CO - Denver County had one of Colorado's lowest vacancy rates, at 3.4 percent, for affordable rental housing in the second quarter, according to a report released Thursday by the Colorado Division of Housing. The report is called the Colorado Affordable Housing Vacancy and Rent Survey. Douglas County reported the highest vacancy rate, at 13.5 percent, of the 14 markets and submarkets analyzed by the housing division. Douglas also had the highest average affordable rental rate for the period, at $842.27 a month.
The statewide vacancy rate for rental housing, which includes subsidized and rent-restricted properties, increased to 6.1 percent in the second period from 4.7 percent a year earlier. But this year's second-quarter vacancies were down from 6.9 percent in the first quarter. "If we're looking at substantial recession and low liquidity, it's harder to buy properties," Ryan McMaken, housing division spokesman, told the Business Journal. "There's also an effect on income growth and employment rate, and that affects workforce housing."
The lowest affordable vacancy rates were in Grand Junction (1.8 percent), Pueblo (2.3 percent) and Denver County (3.4 percent). Pueblo's vacancy rate is an example of how affordable housing tends to have lower vacancy rates than market-rate housing, because they attract different types of renters, according to Gordon Von Stroh, a business professor at the University of Denver who compiled the data for the housing division report. Market-rate housing in Pueblo had a second-quarter vacancy rate of 6.4 percent, compared to its 2.3 percent rent-restricted vacancy rate. "Market-rate units and affordable units should not be attracting the same households," Von Stroh said in a statement.
The highest affordable vacancies for the second quarter were in Fort Collins (9.1 percent), Jefferson County (11.5 percent) and Douglas County (13.5 percent). "In Grand Junction, Pueblo, Denver and Boulder/Broomfield, things are very tight on the affordable side," Steve Wessler, vice president and regional manager at Red Stone Agency Lending LLC in Denver, told the Business Journal. "There's a tremendous need for all types of rental homes, particularly affordable housing for hourly wage earners," said Wessler. "We're seeing more impact from what's been happening in the capital markets for the last year."
Average affordable rental rates statewide in the second quarter dropped to $675.29 a month from $687.56 in last year's second period. Metro Denver affordable rents inched up, though, to $710.42 on average from $708.26 over the same period. Denver County had the lowest average rent for this year's second quarter, at $687.11, of the six-county metro area the housing division measures. "Rents have increased in certain areas, and that's healthier for landlords who have struggled with higher energy costs," Wessler said. "It's also a signal that people are moving back to affordable housing." Pueblo had the lowest second-quarter affordable average rent statewide, at $480.86 a month. The Colorado Division of Housing compiles the affordable housing survey with the Colorado Housing and Finance Authority (CHFA) and Redstone Agency Lending.
Source: Denver Business Journal