Despite booming demand, rents remain affordable relative to housing costs in Denver
March 06, 2019
Healthy Supply-Demand Balance
Denver likely saw peak construction in 2018 with an estimated 12,042 new units delivered in the calendar year.
Driven by another year of +42,000 new jobs added to the market and strong net in-migration, Denver experienced three quarters of record-level absorption in 2018 with occupancy averaging 94.5% during the year.
Rents Remain Affordable Relative to Housing Costs and Income
Denver has been one of the country’s fastest growing cities since the 2008 recession as the city has proved an attractive and affordable alternative to primary coastal cities.
The metro area’s average monthly apartment rent of $1,448 reflects a 60% discount to the median monthly homeownership cost, while average rents comprise just 23% of the median household income.
In dollar terms, Denver is surpassed only by Los Angeles, San Francisco, Seattle, and San Diego for markets where the rent versus own delta is larger.
In 2018, average hourly earnings in Denver increased 6.2% while Boulder residents saw wages grow by a staggering 15% - only Seattle, Nashville, and Los Angeles saw larger wage increases than Denver.