Denver Colorado investment real estate has been somewhat affected by the housing problems. But the Denver real estate investor with eyes wide open may still find some good deals in the small-apartment-complex market. As apartment owners post higher than normal vacancies—up 6.5 percent in the third period—some may decide to sell. At the same time, the Denver CO real estate market is also absorbing 3,000 new apartment units in 2008, mostly in the luxury real estate market.
Forecasters are predicting that investment real estate in Denver will hold its own because it is harder today to be approved for mortgages than in recent years. With home prices flat in August, the Denver CO investment real estate market may just be a way to diversify.
Over time, the area generally experiences its lowest vacancy rates in the second and third quarters. So, the recent news of a high 6.5-percent vacancy rate is a bit hard to swallow. It is up from 5.3 percent for third quarter 2007.
Broken down by county, vacancies for apartments in Denver CO real estate in the third quarter are as follows: Adams County 7.5 percent, Arapahoe County 6.9 percent, Jefferson County 6.5 percent, Denver County 6 percent, Douglas County 5.9 percent, and Boulder/Broomfield County 4.7 percent.
Average rents for Metro Denver increased $33/month to $892.22 since third quarter 2007. Average rents by county from highest to lowest were: Douglas County $1,051.05, Boulder/Broomfield County $974.68, Denver County $906.12, Adams County $882.52, Arapahoe County $850.72, and Jefferson $847.43.
The Colorado Division of Housing issued a recent report citing the soft national economy for some of the higher vacancy levels. However, average rents are actually at a record high. Investors and landlords saw rental losses not because of depreciating values but because of vacancies and incentives. To attract tenants, landlords have been offering incentives such as a month’s free rent and absorbing the losses.
For information about farms, horse properties, and investment real estate in the metro area, call Michael Paul of Realty Oasis at (303) 268-6052.
