Colorado Springs-area apartment rents rose again.
Renters paid an average of $1,130.25 a month during the January-March period, up $13.57 from the fourth quarter and a nearly $70 spike from the first quarter of 2017, according to a report from the Colorado Division of Housing and the Apartment Association of Southern Colorado.
Although several apartment projects under construction will boost the area’s supply, a strong demand for multi-family housing by millennials and empty nesters moving to the Pikes Peak region continues to fuel rent hikes, said Laura Nelson, the Apartment Association’s executive director.
Still, first-quarter rents remained $11.15 below the record of $1,141.40 a month set in the second quarter of 2017. And after nine straight quarters in which rents reached record highs, they’ve leveled off somewhat over the last three quarters.
But it will take a few more quarters to know whether rents have plateaued, Nelson said.
Some of the new apartments will be in higher-end projects that will command top rents and could boost the area’s average cost, she said.
“We’re not quite sure yet exactly where they’re going to set those rents,” Nelson said. New apartments being built downtown could especially boost average rents, she said.
Then again, 7,500 Fort Carson soldiers are being deployed this spring to Afghanistan, which could leave many apartments empty, Nelson said.
“It’s hard to know if it will have an effect on rents,” she said.
In any case, the overall apartment market remains healthy, Nelson said.
The first-quarter vacancy rate of 6.3 percent was up from 5.4 percent in the fourth quarter, yet down a little more than a full percentage point from a year ago, the Housing Division and Apartment Association report shows.
“The vacancy rate is still considerably low for the first quarter,” Nelson said. “It’s still pretty healthy – 6 percent for the first quarter of the year.”
The Housing Division and Apartment Association report also showed:
– Average rents were highest on the city’s northwest side in the first quarter – $1,225.49 a month. The lowest average rent of $941.32 was found on the Springs’ southeast side.
– The newer the apartment, the pricier it will be. Apartments built since 2010 averaged almost $1,445 a month. Apartments built in the 1970s had the cheapest average rents of $935.20 a month.
– One-bedroom apartments citywide averaged almost $1,013 a month in the first quarter; two-bedroom, one-bathroom units averaged $1,065.27; and three-bedroom apartments averaged $1,513 a month.
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