The apartment vacancy rate in the Colorado Springs area fell in the first quarter from three months earlier, as developers have added more than 1,400 units to the market during the past two years.
Still, the first-quarter vacancy rate is higher than a year ago: 6.7 percent, compared with 5.6 percent in the first quarter of 2013, according to a report released Monday by the Colorado Division of Housing. The 2013 figure was the second lowest level for any quarter in nearly 12 years.
"The new construction in the market has taken some pressure off the vacancy rates in the Colorado Springs market. You are not facing a 3 percent vacancy rate that you would have without any new construction, said Ryan McMaken, a Housing Division economist. "I would call the Colorado Springs market solid, but not frothy or overheated, It is a healthy apartment market. You are seeing some solid employment growth and the level of new construction is not immense."
The area's apartment vacancy rate was 7.1 percent in the fourth quarter, when the percentage of vacant units typically reaches its seasonal peak.
The area's first-quarter vacancy rate would have been 4.9 percent without including apartment complexes that were still in the process of trying to fill units after completing construction.
As apartments filled up, rents increased by 4.4 percent during the 12 months ending March 31, according to the report. The average monthly rent in the first quarter rose to $822.14, or up $34.40 from the first quarter of 2013.It was the 17th consecutive quarter in which average rents increased from the same quarter a year earlier.
Local apartment vacancies and average rents were highest in northwest Colorado Springs at 13.7 percent and $903.13 a month, respectively, and lowest in the Security-Widefield-Fountain area near Fort Carson at 3.9 percent and $627.35 a month, respectively. Complexes still in the initial lease-up phase added more than 10 percentage points to vacancies in northwest Colorado Springs, which would have ranked as the area's lowest with those units subtracted, the report said.
Rental discounts and concessions also were up for the first quarter, averaging 11.9 percent compared with 7.3 percent during the previous quarter and 8.7 percent in the first quarter of 2013. Average rents in the report do not include discounts or concessions.
The report is based on a survey of apartment owners and landlords and included 21,444 units.
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