Why Denver's rent relief may not last long
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A historic apartment building boom means metro Denver renters are getting some of the best deals in the country — for now.
Why it matters: A flood of new apartments in 2024 has lowered rents and produced what industry analysts say are the nation's biggest rental concessions. But that window could close quickly as construction slows and vacant units fill.
What they're saying: "We have the biggest concessions … of anywhere in the country," Apartment Appraisers & Consultants president Scott Rathbun told reporters Monday, citing feedback from national operators.
- Rathbun said record demand has been fueled by the combination of steep discounts and a housing market that's priced out many would-be buyers.
By the numbers: More than 8,300 apartments were filled in the second quarter of this year — a record pace that quickly ate into vacant inventory — compared with just 3,300 new units added.
- $175: The average monthly concession renters are receiving — nearly 10% off rent, or roughly four to five weeks free over the course of a year.
- 3%: Average rents are down from a year ago, holding around $1,800.
What we're watching: The development pipeline has shrunk dramatically, from roughly 120,000 proposed apartments at its peak to about 54,000 today, per the Apartment Association of Metro Denver.
- Industry leaders say the decline reflects increasingly difficult financing, with developers battling higher construction costs and local housing policies that have made some projects harder to pencil out.
What's next: If apartment construction continues to slow while demand stays strong, today's deep discounts could disappear as soon as 2027, industry analysts say.