COLORADO SPRINGS — Rent in Colorado Springs remained stable month-over-month, with a slight decrease compared to this time last year. But prices may still be out of reach for many despite the opening of thousands of new units.
The Department of Housing and Urban Development (HUD) has labeled the market as “soft,” meaning vacancies are high and rents are not increasing.
Current median rent prices in the region vary based on the source, but sites like Apartment List notch the going rate around $1451 a month. That’s a -0.3% decrease from last month and down -2.5% from this point last year.
Compared to Denver, Colorado Springs rent is about $350 less per month. But salaries are about 15% lower, so it somewhat evens out, said Tatiana Bailey with Data-Driven Economic Strategies (DDES).
Nationwide, Apartment List said rents have increased about 0.6% month-to-month. Prices in Colorado Springs have decreased, but not by much. And the upcoming summer months could see those prices slightly tick back up.
“The rental market is very seasonal,” said Rob Warnock, senior research associate with Apartment List. “Rents tend to go down during the winter, they tend to come up during the spring and summer. It's just a function of when people are moving and when the weather's better. And when schools are in session.”
The latest National Rent Report from website Zumper noted that Colorado Springs saw a record number of new housing supply hit the market with 3,000 completed units last year and another 9,000 under construction.
Tatiana Bailey, founder and executive director of Data-Driven Economic Strategies, said the sudden market saturation is a remnant of low interest rates several years ago. Developers took advantage and pulled thousands of permits, but it of course takes several years to build those up.
And vacancies are sitting at about 11% as of the fourth quarter in 2023. But there remains a housing shortage, Bailey noted, which may seem counterintuitive.
“The blip that we're seeing now—and I do think it's a blip with apartments—and the higher vacancy rate, is going to get absorbed, it is going to equilibrate,” said Bailey. “But at the end of the day, we still have this housing shortage. And it is a national phenomenon. And it's totally a remnant of the Great Recession.”
Bailey said the 2008 recession brought building to a screeching halt and many builders since then have been skittish on bringing new product to market without guaranteed demand.
To address the shortage, she said there needs to be an additional 9000 units built by 2028.
Despite the high vacancies and number of new apartments, Bailey said prices have only come down nominally in the past year. By her estimate, about 10 to 24 dollars per month.
“Investors and landlords are confident that even if they have to offer some additional concessions, they can usually still get people in the door,” Bailey said. “But also some of that is the average is being pulled up by the professionals who can pay 2000 plus per month for renting an apartment.”
Bailey recommended renters to consider “doubling up” by living with parents, other family, or more roommates.
Since rents are expected to hold steady for the time being, Bailey’s advice is “don’t be shy” when it comes to pushing for apartment concessions.
Now is a good time to ask for a free month of rent, lower security deposit, free gym memberships, or month-to-month without premiums, she said.
Email Senior Reporter Brett Forrest at brett.forrest@koaa.com. Follow @brettforrestTVon X and Brett Forrest News on Facebook.
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