As seen in Denver Business Journal
Rent costs in the Denver-metro area recorded the largest monthly decline in the nation in January, according to Zillow’s monthly rental report.
Denver was one of 11 major metro areas where monthly rental rates fell, leading the way at a 0.4% decline in January rent costs, the report shows. Cincinnati and Birmingham tied for second place with a decline of 0.2%.
The decline bucked a national trend where rents increased in 47 of the 50 largest metro areas in January compared to the same month last year, according to Zillow.
The typical January rent in the Denver region was $1,918, a 0.8% decrease from January 2024.
Multifamily rents experienced a larger decline than single-family rental properties, with Denver once again recording the largest drop in the nation at 0.5% in January, tying with Cincinnati.
Denver also led the nation in its annual increase in the share of listings offering renters concessions, which jumped 20.7 percentage points year over year. That was followed by Nashville at 17.2 percentage points. Concessions increased from year-ago levels in 48 of the 50 largest metro areas.
In January 67.2% of rental listings in Denver included concessions, Zillow found — a far higher rate than the U.S. average.
“While most metros are seeing rent growth, landlords are increasingly offering concessions to attract renters, with more than 41% of Zillow rental listings featuring incentives in January – a record high in Zillow data,” the report notes. “However, there are signs these concessions may decline in the coming months.”
The trend in rental rates softening and terms becoming more friendly to Denver-area renters isn’t new.
The Apartment Association of Metro Denver’s fourth-quarter vacancy and rent report for 2024 showed the number of new multifamily properties that came online in the Denver-metro area last year led to higher vacancy rates and lower rent costs at apartment buildings, the association noted in January.
A total of 19,910 new units came online in the previous 12 months across the metro area, according to the association, with 2,228 new units in the fourth quarter alone, setting a record for a calendar year. That increased the supply of apartments in the Denver-metro area by 4.8% in 2024.
The flood of apartments led to a record $69 decrease in the area’s average monthly rent for multifamily properties to the previous quarter, marking a 1.5% decrease from the previous year, the association’s report noted.
While the current trend favor renters, that is expected to change soon.
“2025 will still deliver a lot of new units, and so there’ll be a lot of competition out there, but the spigot pretty much gets turned off, you know, in the next, I don’t know, 18 to 24 months,” Mark Williams, the executive vice president of the association, said in January. “And that’s going to be bad news for renters and bad news for the market, really.”
