Apartment vacancies in Boulder, minus the "university area," dropped to 2 percent during the last three months of 2007, making the city's rental market the tightest in the Denver metro area, according to a report released Wednesday. Near the University of Colorado campus, vacancies were slightly higher, at 3.7 percent, according to the Metro Denver Multifamily Vacancy and Rent Survey, a report released quarterly by the Colorado Division of Housing and the Apartment Association of Metro Denver.
Vacancy rates in markets across Boulder and Broomfield counties varied widely, with Broomfield at 6 percent; "Boulder County-other," which includes Louisville, Lafayette and Superior, at 3.3 percent; and Longmont at 11.5 percent. Longmont's higher rate is the result of new rental units on the marketplace, said Gordon von Stroh, a University of Denver professor of business who researched and authored the report.
Anything below 5 percent is considered a "tight" market, von Stroh said. "To me, 'supply and demand' is such an important ingredient," von Stroh said. "The rent levels will go up simply because of the limited supply. Ideally, then, the developers and the owners will say, 'Hey, there's incentive to develop more units.'"
Since late 2002, when additional housing near CU was built, the available rental units in Boulder have steadily declined, said Jerry Kendall, vice president of Countrywide Commercial Real Estate. "What's happened now is you've had a constant contraction here," he said. What also has changed in five years is that there's very little new construction now of multi-family rental units, he said.
Von Stroh calls the decline of vacancies a "dilemma," considering a growing university population and calls for a bolstering of the city's job base. "If you're going to promote economic development in the city of Boulder, you need to think about all of the ingredients necessary, and part of it is housing," he said. In the overall metro area, vacancies were 6.1 percent during the fourth quarter of 2007, and the average rent was $860. The vacancies were down from 7 percent in the same quarter in 2006, the report said.
For the "Boulder/Broomfield area," vacancies were 5.4 percent overall, and the average rent was $937, the second-highest of the metro counties, according to the report. Douglas County's was the highest, at $1,043, and Arapahoe County's was the lowest, at $814.
Source: DailyCamera.com