Rental revenue rises again in Denver in 2011: report

Ken Green, Denver Top News Examiner, January 5, 2012

The Denver metro area posted one of the biggest annual rent increase percentages in the nation in 2011, a rise that continues a trend begun in 2010, according to national rental research firm.

According to a report issued Thursday by the Texas-based MPF Research, rents in Denver rose by 6.7 percent in 2011, the eighth largest annual rent increase percentage in the nation. An October 12 report on the Denver rental market by MPF Research predicted that rental prices would rise by at least 6.5 percent.

The percentage of increase in rent prices in Denver placed it behind San Francisco, the city with the biggest increase14.6 percent, followed by San Jose, California (12.3 percent), Oakland (9.4 percent), Boston (8.3 percent), New York City (7.3 percent), Austin, Texas (7.2 percent) and Pittsburgh (6.8 percent). Behind Denver were Seattle 5.9 percent) and Charlotte, North Carolina, Chicago and Minneapolis (all at 5.8 percent).

Rent increases occurred in almost all communities in the Denver metro area. According to MPF Research’s October report, increases in the Denver Tech Center area reached 8.6 percent, 7.5 percent in Littleton, 7.0 percent in south Aurora, 6.9 percent in intown Denver, 6.8 percent in south Denver and west Englewood and 6.8 percent in north Aurora. Only Westminster and Arvada/Golden posted rent price increases below 3.0 percent.

From March to September, rent increased in Denver by 5.6 percent and overall, the rent increase percentage in Denver was the largest of the past decade outside of 2007.

Nationally, rental revenue rose by 5.8 percent in 2011 while national occupancy rates of apartments grew by 1.1 percent to reach 94.6 percent. In 2010, rental occupancy rates stood at 93.5 percent.

“While apartment demand has cooled off a bit from 2010’s incredibly large volume, it remains very strong,” said MPF Research Vice President Greg Willett. “Most of the jobs being formed are going to young adults, who tend to be renters. At the same time, loss of renters to purchase continues to run far below the historical norm. Those factors are combining to produce demand far in excess of the limited deliveries coming on stream right now, especially when today’s completions are heavy on niche product such as affordable housing, seniors housing or student properties, rather than conventional, market-rate apartments.”

Among the worst performing areas in rental revenue was Las Vegas, which saw rents down by 0.4 percent. However, rental revenue in the area managed to climb slightly as the metro area saw occupancy grow by 1.3 percent.

MFP Research said the rental market in Denver and other metro area should continue to increase in 2012 and predicted that occupancy will grow by another half a percentage point and rents will rise by at least 4.5 percent.

Continue reading on Examiner.com Rental revenue rises again in Denver in 2011: report – Denver Top News | Examiner.com http://www.examiner.com/top-news-in-denver/rental-revenue-rises-again-denver-2011-report#ixzz1ihNHlWfb

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About dherries
Dave and Sally Herries and The RealtyColorado Team - Real Estate Broker serving the metro-Denver area. Offering properties in urban, sub-urban and rural areas. Our mission statement is "Enriching lives through real estate."

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