Denver Rental Report - 2024
I have had multiple conversations over the past few weeks about the state of the Denver rental market.
Are prices going up?
Are prices going down?
What should I expect when my lease is up for renewal?
“Steady but Segmented”
Keyrenter Denver (property manager of over 1,000 Denver metro properties) provided this concise summary —
Single-family homes in suburban neighborhoods continue to be the strongest performers as tenants prioritize space and long-term stability
in contrast
“multi-family units, particularly in downtown areas, face slower demand, leading to competitive pricing and increased incentives to fill vacancies.”
YoY stands for “Year over Year” tracking changes over a twelve-month period.
Record Number of New Apartments Construction
The Apartment Association of Metro Denver reported the following as part of their Second Quarter Vacancy & Rent Report for Metro Denver.
“In the 44-year history of this report, we have the highest 12-month delivery of new apartments we have ever had, with 7,399 new units delivered this quarter and nearly 19,000 units delivered in the last 12 months,” said Mark Williams, executive vice president for the Apartment Association of Metro Denver.
Williams continued, “In the face of serious increases in expenses, interest rate challenges for loans, and poorly thought-out legislation, rents are essentially level with where they were 24 months ago. The explanation for that is increased supply, in the form of 31,235 new apartments over the last 24 months.” (article: July 25, 2024. orginal source)
How does Denver Metro compare to the U.S.?
CoreLogic reports that U.S. rent growth for Single Family homes (not apartments or condos) in 2024 registered a 1.7% annual increase through October 2024, marking the lowest rate recorded since June 2020 [source].
By contrast, the decade prior to the pandemic reported average annual rent growth of 3.5% [source].
You can scroll up to review the orange skyline data pulled from Zillow that shows Denver median prices.
Average prices are not available that I can find, but averages are normally higher than median.
There are a number of reasons the data is hard to track.
The primary reason is that there is no centralized database of information like there is for home sales on the MLS.
Relatedly, while the advertised asking price is often public, the actual negotiated lease price and terms are generally not public.
That being said, my summary take from hours of research is:
a) single family homes are holding steady Year over Year (YoY), and
b) condos and apartments are taking the biggest hit
(see the construction report above for the main reason why).
Brandon Scholten, CEO of Keyrenter reported in November that some of their properties (again, 1000+ in their portfolio) are now renting for about $200 less/mo than they were a year ago.
“The 2 bed 1 bath condos are worse than they’ve ever been. They are really hard to rent right now. Maybe people have just gotten really resistant to sharing a bathroom. 3 bed 1 bath homes are also brutal [for that same reason].”
Note: this chart reports growth along the y-axis, so a flat horizontal line at 3% indicates consistent rental price growth, not zero growth.
Tips, Tricks, and Trends
Tips
There have been approximately fifty gazillion billion new regulations passed by Colorado legislature that affect landlords and tenants.
I reported on many of them here, and you can find a different summary on Keyrenter’s website here.
One attorney was reported as stating (off the record, to my knowledge) that it’s almost impossible for landlords to keep up with all the changes.
The best advice I can offer is to PLEASE communicate proactively about plans to renew or not renew with your tenants or landlord.
Everyone is trying to keep up, and unstable housing and moving can be stressful.
No one wants to be caught off guard by a regulation they weren’t aware of that might have become law during the time since a lease was first initiated.
Tricks
In an effort to keep advertised rental rates high, many high-end apartment buildings are offering free weeks of occupancy on select apartments in exchange for tenants signing a 12+ month lease at their desired monthly rate.
Advertised Hanover Rino promo from a Google search Jan 21, 2025.
Trends
High-end urban apartments are offering increasingly attractive amenities in hopes of luring tenants who can pay their high prices.
The trending amenities include co-working lounges, rooftop dog parks, pools, outdoor community grills and dining spaces.
Photo from a rental listing for the Edit Building in Rino, where apartments start at $1,348/mo for a 424 square-foot studio apartment, and run almost twice the metro average, at $3,661/mo for an 1,101 square-foot 2 bedroom 2 bath apartment.
What to Expect in 2025
Slowed or Flat Rental Price Growth (Market Rate)
The flood of new inventory to market in Denver should provide a window of relief and flat or slightly declined rental prices - pay attention to the “trick” section above that can mask lowering rates.
Single-family home prices, if currently at market rate, will likely see largely flat renewal prices or experience minimal growth as the result of the current slower economic conditions.
Increased Rental Rate Growth (Below Market Rate)
For tenants who have benefitted from below-market rental prices over the past few years, that benefit window will likely be closing.
As property taxes climb, homeowners insurance costs skyrocket, maintenance costs increase due to inflation, and the local government adds more and more regulations that impose both hard costs and increased risk considerations on landlords, even the most generous of landlords have almost no choice but to increase rents just to stay at break even.
Parting Words of Advice
Tenants
Do your homework of looking at comparable rent rates in preparation for communication with your landlord.
If you have high rent, you likely have margin to negotiate a “no-increase” year if you’re willing to renew.
Landlords
Ensure your leases are up to date with terms that reflect the latest regulation changes.
Do your best to get your tenants on a late spring or early summer renewal schedule. Avoid creating leases that require renewal in October through January.
This ensures you have the largest pool of new tenant candidates when it’s time for lease renewal.
If you have a desire to buy or sell, let’s chat!
Life has a way of keeping us all moving, and I’d love to be your real estate agent.
Contact me here to set up your free and confidential consultation.
Kevin
