The average monthly cost of renting an apartment in the Colorado Springs area has surpassed $1,200 for the first time.
That’s according to a recent, statewide report that also indicates the rising trend shows no sign of slowing down as the area’s economy remains strong.
According to the Colorado Division of Housing and the Apartment Association of Southern Colorado, the average rent during the second quarter of this year is $1,217.
That’s an increase of 5% over the same period in 2018 and is the second straight quarter that rent has exceeded previous highs.
Rebecca Esparza can relate to the situation. She and her husband have seen the rent for their small apartment jump from $800 to $1,150 in three years.
“We’d like to live somewhere nicer,” she said. “But jobs don’t pay much. It’s frustrating. We may have to move in with our parents in California to make ends meet.”
Indications are that demand for apartments will continue to be high, as between 35,000 and 40,000 people move to the area annually and seek cheaper alternatives to high home costs.
Experts cite higher construction costs, such as for labor and materials, for contributing to rising rent costs, as well as variables such as added rental insurance and newer complexes offering more amenities.
But there’s mixed opinion about whether the apartment supply is keeping up with demand. Around 50,000 new units have been added to the area’s inventory in the first half of this year, but the vacancy rate has fallen from 6% last year to 5% this year.
According to the report, rental costs will continue to rise by 3% to 4% annually for the foreseeable future — meaning the salaries of many tenants are not keeping up with such increases.
“For a $1,200-a-month apartment to be affordable, a tenant has to be earning at least $23 an hour,” said Steve Posey, the city’s Housing and Urban Development programs manager. “A third of our workforce isn’t making that much.”
Posey said the situation will continue as long as the area remains such a desirable place to live or until the economy changes.
“All we can do is keep pushing for affordable housing programs and hope builders will want to participate,” he said.