Vacancy rates in state vary by region

Ski areas short on apartment rentals; plains have plenty

By John Rebchook, Rocky Mountain News (Contact)

Published June 19, 2008 at 9:05 p.m.

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The statewide apartment market outside the Denver area is a story of three distinct regions.

There is the Interstate 70 corridor, where the ski areas especially have a shortage of rental units; high apartment vacancies in agricultural areas on the plains; and a "yo-yo" market in Colorado Springs, where vacancies go up and down depending on whether soldiers are being deployed to Iraq from Fort Carson.

Overall, the vacancy rate for apartment buildings in Colorado outside the Denver area was 6.1 percent at the end of the first quarter, almost 19 percent lower than the 7.5 percent rate a year earlier, according to the latest report by the Colorado Division of Housing.

Report author Gordon Von Stroh said what may be most surprising is the relatively high vacancy rate on the plains, given the robust agricultural market. Sterling posted a 7.6 percent vacancy rate, and Fort Morgan's stood at 8.7 percent.

"It's thanks to technology," Von Stroh said. "Technological advances have made it so they need less farm labor."

Areas with vacancy rates below 5 percent include Alamosa, Aspen, Buena Vista, Canon City, Durango, Eagle County, Glenwood Springs, Grand Junction, Gunnison, Montrose, Steamboat Springs and Summit County.

"Vail and Aspen and Glenwood Springs and Summit County, with their service industries, are very labor-intensive," and need a lot of apartment units, Von Stroh said.

Colorado Springs recorded a vacancy rate of 9 percent; Greeley, 7.3 percent; Pueblo, 6 percent; and Fort Collins/Loveland, 5.2 percent.

Aspen had the highest median monthly rent at $1,176. The average monthly rent in Aspen was $1,133.

Sterling had the lowest median rent at $336. The average rent in Sterling was $342.

An earlier report by Von Stroh showed that the first-quarter Denver-area vacancy rate stood at a seven-year low of 2.7 percent, a 36 percent drop from 4.1 percent a year earlier.

In Colorado Springs, apartments near Fort Carson suffer the most from high vacancy rates.

"This yo-yo business isn't good psychologically for apartment owners and is not good economically," Von Stroh said. "It wears people down. They need to see some stability."

Kathi Williams, head of the housing division, said that the bustling energy businesses along the Western Slope are doing a good job of providing "manufacturing housing dormitories and portable camps that can be torn down in 48 hours."

But she said the support people serving the oil and gas businesses are having trouble finding affordable housing.

rebchookj@RockyMountainNews.com or 303-954-5207

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