A steadily growing population throughout the region has made the leasing part of apartment property managers’ jobs fairly easy the past several years.
However, since the beginning of January, the demand for apartments appears to have slowed slightly, likely due to seasonality and new units coming online, said Carmen Azzopardi, senior vice president of multifamily property services at Griffis/Blessing Inc.
“It’s primarily been this first quarter where we have seen a little dip in the market,” she said. “We also are seeing a little bit more rate changes as well as move-in specials on some properties.”
Colorado Springs apartment vacancy rates were 5.4 percent for the third and fourth quarters of 2017, which was down from 2016’s 6.8 percent but up from 2015’s 5 percent, according to the Colorado Springs Metro Area Apartment Vacancy and Rent Study.
Though vacancy rates for the first quarter of 2018 won’t be available until after March, the first few months of 2017 saw the year’s highest vacancy rates, said Laura Nelson, executive director for the Apartment Association of Southern Colorado.
“I think it’s pretty typical for vacancy rates to be higher during the winter and spring months in Colorado Springs,” she said. “People tend to move more after school is over in the summer months, so the fourth and first quarter are affected more by less migration of sorts.”
Vue 21 Apartments’ Community Manager Denise Durbin also noticed a small decrease in demand for vacancies at the property located at 4610 Nautilus Peak View. “I would say that it kind of plateaued for us towards the end of January,” she said. “It kind of leveled off a little bit, and it hasn’t been as busy as it has been.”
Job opportunities slow in the winter, so fewer people move to Colorado Springs, Azzopardi said.
“It’s when it’s cold we have some of our bigger move-in specials at some of our properties to hopefully attract more people,” she said.
New construction, such as The Overlook at Interquest property, managed by Griffis/Blessing, also may factor into the demand slide, Azzopardi said.
The property began leasing units in November and will eventually have 264 units, including 30 units slated for opening next week, leasing consultant Sydney Beswick said.
“We are super excited for this location right along Interstate 25,” she said. “It’s wonderful because you really can quickly get to anything you need from here.”
Durbin said newly opened apartments such as the The Overlook in northern Colorado Springs as well as the ECO Apartments downtown add to increased vacancies.
“That, and so many more people [are] looking to buy houses right now,” she said.
Colorado Springs saw the addition of 40 new apartment units during the fourth quarter of 2017 compared to five in 2016, according to results of the Colorado Springs Metro Area Apartment Vacancy and Rent Study.
“For all of 2017, there were a total of 1,521 new additions, and for all of 2016, there were a total of 528 new additions,” the study said.
Neither Azzopardi nor Durbin believe the lull will last long.
“This time of year used to be our slow time of year because of seasonality, and then the last two or three years seasonality really didn’t factor in to people renting apartments, but it is still typically slower this time of year,” Durbin said. “It’s not something I’m real concerned about because I honestly think it’s going to pick back up probably in April or May.”
The market has been robust for several years, marked by increasing rents over the more than 9,400 apartment units the company manages, Azzopardi said.
“We were seeing 7 to 9 percent rent increases in the past five years, and now we’re kind of seeing a 3 percent rent increase, so we’re just seeing some changes,” she said.
Colorado is currently home to several cities with the fastest-growing rent prices in the U.S., according to a March 13 article by RENTCafé, an apartment search website. In Colorado Springs, apartment rentals last month were 6.5 percent more expensive than February last year, the article stated.