COLORADO SPRINGS — Almost all the major apartment buildings in downtown Colorado Springs are offering some form of a major concession right now, hoping to lure renters into their properties.
The new Experience at the Epicenter, next to Weidner Field on Sierra Madre St, is advertising no rent until 2025, free parking for up to six months, and moving cost assistance on select homes on its website.
According to their websites, other spots like the Ensley on Weber St, the Mae on Cascade, and 333 ECO Apartments on Colorado Ave are each offering the first eight weeks rent-free, as long as a tour and lease signing happen between 24 to 48 hours.
The Village at New South End, near the Colorado Springs Police Department, is advertising a $2,000 VISA gift card for anyone who signs a new lease by November 30.
And the Vim, a complex on E Vermijo Ave, is offering two months free rent with a look and lease within 24 hours.
It’s no secret there has been an influx of apartments going up downtown in recent years, but this mass wave of concessions is not an indicator of sky-high vacancy rates, according to real estate and economic experts.
Tatiana Bailey, a local economist and founder of Data-Driven Economic Strategies, said current vacancy rates are around 6.3%, which is much lower from a high of 11%. That vacancy rate is from the end of September before some new units opened up.
“All of this new product has come online from all of those permits that were pulled as we were coming out of the pandemic in 2021, 2022, when interest rates were still low,” said Bailey. “So the simple fact that vacancy rates are coming down and absorption is high simply tells me that there are people who are filling these apartments.”
Bailey said the growth of Colorado Springs is still large enough that despite all these apartments and new builds coming online, there is still a housing shortage of eight to nine thousand units.
“I do worry a bit about whether we are building enough affordable apartments. Those get absorbed very quickly,” said Bailey. “We can't build them quickly enough. And there are wait lists, whether it's through public subsidies or not. Anything that's affordable goes very, very quickly.”
And it’s not just downtown, with other properties around the area also offering concessions.
Daryl Fairweather, the chief economist with real estate site Redfin, said Colorado Springs is currently a renter’s market. There are plenty of options with a variety of concessions, but prices do remain elevated.
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Current market data from Redfin and Apartment Insights showed the average rent in Colorado Springs is around $1500 a month, regardless of unit size. But that number has remained steady and is likely to continue being flat in the near future.
“New construction starts have slowed down, but completions are still high, which means that there's still new inventory coming onto the market,” said Fairweather. “There are buildings that just were completed this year that still haven't filled up yet. So I think we're going to see another year of pretty flat rents.”
Fairweather said concessions are a way to fill up vacancies without lowering rents, which could cause distress amongst current residents who’ve already signed a lease.
She also noted autumn and winter are typically the seasons with fewer people moving, which is another incentive for apartments to offer concessions.
The Apartment Association of Southern Colorado (AASC) also noted that the new apartment concessions are working, bringing in new tenants from older or less expensive buildings, which in turn is leaving those with higher vacancies.
Laura Nelson, executive director of the AASC, said one of the older properties she oversees currently has a 14% vacancy because of that movement.
“This is certainly a blip in time when a product comes on and people aren’t moving. You’ll always see where vacancies go up in fall and winter and come down in spring and summer when people start moving again,” said Nelson. “This will assist in leveling out where we are in rental prices.”
But at the end of the day, low vacancy or plenty of apartment options still aren’t much help when many residents still can’t afford it.
Caleb Neises currently rents an apartment with his girlfriend on the north side of town. They’re looking to move into a house with two friends to save money. Neises would like to save enough to one day buy his own house, but he feels he’s wasting too much money on rent.
“We're paying, after everything, $2,000 for 900 square feet at the end of the month, every month. And that adds up quick,” said Neises. “You're paying $24,000 a year minimum for renting a house that is just going down the drain.”
Neises said his group has had trouble finding the right home whether it’s difficult property managers, the location, price, size, or because they have pet cats.
He’s open to moving back into an apartment, but the prices for anywhere they’d like to live are simply too high.
“What's the word, uh, frustrating? I guess I would say it's really frustrating,” he said. “This market here is just so crazy. I mean, Colorado Springs is a very desirable place to live right now.”
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