Vacancy rate falling in GJ, but so are rents
Grand Junction’s rental apartment vacancy rate — and monthly rent on those apartments with tenants — fell in the first quarter of 2014.
The Colorado Division of Housing released a report Wednesday showing the city’s vacancy rate was 5.3 percent in the first quarter of this year, down from 6.7 percent in the previous quarter and less than half of the 11.8 percent vacancy rate at the start of 2013.
The average cost of rent also dropped, from $554.20 in the first quarter of 2013 to $525.24 in the first quarter of this year. Average rent cost $561.04 in the fourth quarter of 2013.
Although Grand Junction’s job market hasn’t caught up with the robust economy of the mid-2000s, a downward trend in local unemployment and some stabilization this year in the number of residents in the labor force likely helped keep people in town and in their apartments, according to Ryan McMaken, an economist with the state agency. He said the decrease in the vacancy rate quarter over quarter may be linked to increases late in 2013 in mortgage interest rates, making home-buying less affordable and/or attractive.
While 5.3 percent vacancy is just three-tenths of a percentage point above what rental experts consider a tight or healthy rental market, a monthly rent of $525 on average is far behind what renters in other parts of the state are charging and the lowest among seven Colorado metropolitan areas. McMaken said that’s likely a result of Grand Junction’s economy improving but not being recovered from the recession. While the vacancy rate has regressed to its lowest point (with one quarter’s exception) since the recession hit locally in the second quarter of 2009, rent prices are harkening back to earlier times, with the average rent at its lowest point since the third quarter of 2005.
“(Grand Junction) had rent levels progressing at a normal clip in 2005 and 2006 but really started to accelerate in 2007 and early 2008. Those numbers are just now returning to where they were before that acceleration,” McMaken said.
Vacancy rates dropped quarter over quarter in Grand Junction, Greeley, Pueblo, Colorado Springs, Fort Collins and metropolitan Denver but increased in Boulder/Broomfield. Pueblo had the highest vacancy rate in the first quarter at 8.1 percent, followed by 6.7 percent in both Boulder/Broomfield and Colorado Springs. Below Grand Junction’s rate were Denver with 5.1 percent vacancy, Greeley with 4.4 percent vacancy, and Fort Collins with 1.6 percent vacancy.