Apartment vacancy rates continue to decline as so many homeowners become renters. “Vacancy rates remain near 10-year lows and the vacancy rate has dropped year-over-year for the past eight quarters in a row,” reported Ron Throupe, an assistant business professor at the University of Denver. As economics tend to do, scarcity drove up price. The median monthly rent in metro Denver rose to $881, a 2.9% hike from the third quarter of last year, when the median rent was $856. Concessions, discounts and delinquencies fell from 13.6% last year to 10.4% for the same quarter this year. “We’re starting to see concessions go away and all those offers for free rent are becoming rare as vacancies fall,” according to Colorado Division of Housing spokesman Ryan McMaken.
“Vacancy rates remain near 10-year lows and the vacancy rate has dropped year-over-year for the past eight quarters in a row”
This, of course, is great news for local real estate investors. As both home prices and interest rates remain low, investors are picking up bargains and taking advantage of record low vacancy rates and rising rents to produce terrific cash flow. Our clients are buying these properties with the intent to hold them for a number of years, producing income every month and paying the mortgages down over time. Some of our clients plan to wait until the market turns, get some appreciation, then cash out and move their money into other investments. Others are thinking long term by using the cash flow to pay off the mortgages and holding the properties for retirement. Either way, prudent investors are taking advantage of this once in a generation opportunity to buy quality homes at bargain prices. Call me if you want to discuss how you can do the same thing!