It is endemic to areas with too many buyers and renters and not enough housing to go around — rent just keeps going up in Fort Collins.
As vacancy rates continue to drop, Fort Collins is looking at one of the tightest rental markets it’s ever seen.
Anything below a 5 percent vacancy rate is considered a tight market and Fort Collins falls significantly below the mark. At the start of 2012, Fort Collins had a vacancy rate of 2.6 percent according to the Colorado Multi-Family Housing Vacancy & Rental Survey.
The same survey also shows that the average rent in Fort Collins has gone from $837 in early 2010 to $1010 at the start of 2012, with rates increasing each quarter.
According to Jeannie Ortega, director of Off Campus Life at CSU, the projected rent increase is around 2 percent for the upcoming year.
In a college town, nearly half of housing is rental property, according to Ortega. This means a quick turnover in residents and much wear-and-tear on the dwellings.
“(Rent increases) are typical. It’s a demand thing because the market is very tight. It may seem like it is for-profit, but when everyone else is raising prices, we have to keep up,” said Lauren Winn, a leasing assistant at Ram’s Village.
During the rough patch in the economy, Fort Collins builders and buyers found that building and developing was risky.
“People are holding off on purchasing homes and staying in rentals longer due to the recent economic downturn and slow recovery. There has also been less building going on in the area to help off-set the demand, adding to the tight rental market, (which) gives landlords more price power to increase rents,” Ortega wrote in an email to the Collegian.
While enrollment at CSU increased, fewer developments went up, dropping the vacancy rates and upping rent prices.
“Prices will probably go up a little bit for the next two or three years, but it will slow down for sure,” Winn said.
The increase in new developments such as the Summit apartment complex on College, the Grove apartment complex and several others, should provide a small respite from low vacancy rates.
“We have a lot of new developments going up currently to combat (low vacancy rates),” Winn said.
However, these complexes are filling up quickly and prices are still climbing for incoming residents.
Annie Freymuth, a junior living at the Prospect Plaza Apartments, is seeing a jump of over $100 a month.
“They didn’t do any updates to the apartment. I think they re-carpeted the hallway and that’s it,” Freymuth said.
This is her third year at the same complex. When she first moved in, in 2010, she paid $540 a month and is now paying $780 per month for a one bedroom apartment.
“I’m really not happy about it,” Freymuth said.
Many students do not see the smaller rent increases since they change housing each year. It is typical to see monthly rent prices increase at each lease turnover.
As the economy continues to recover, renters can only hope for these rates to equalize.
“The rental market is like a pendulum and has a way of eventually adjusting itself. But we need to remember that Fort Collins is well known for being a great place to live. That attraction will impact where rents are set, now and in the future,” Ortega wrote.
Senior Reporter Mariah Wenzel can be reached at firstname.lastname@example.org.