With vacancy rates down, timing good to buy rental properties
The Grand Junction rental housing market is doing better than expected, way better. The first quarter vacancy rate for Grand Junction was 6.3 percent, down from 11.6 percent for the same quarter last year.
This information is based on the Gordon Von Stroh Denver University survey for apartment rentals statewide. Apartment managers in this market are happy to see increased demand, full apartments and higher rents.
The Denver rental market is doing even better, making it a great time to be a landlord. From an April 28 Inside Colorado Real Estate article:
“Despite hitting a 10-year first-quarter low of 5.5 percent, Denver-area renters should brace for even lower vacancy rates — and higher rents — later this year.
“‘There will be some sticker shock,’ said Gordon Von Stroh, the University of Denver business professor who authored the apartment vacancy rate report for the Apartment Association of Metro Denver and Colorado Division of Housing. Von Stroh noted that despite mortgage rates near historic lows, it also is much more difficult to qualify for a mortgage. That means fewer people will be leaving apartments to buy homes as seen in the past.
“‘I think it is going to become increasingly harder to get a mortgage,” Von Stroh said. “The American policy system is finally starting to recognize that not everyone should be a homeowner. We should have recognized that 20 years ago. We would not be in this current financial mess, if we had.’”
It’s a good time for investment buyers to purchase rental properties as the prices and mortgage rates remain low and rents trend upward. In the Grand Valley, it might be wise to look at properties near the growing Colorado Mesa University. Incoming CMU students could have a challenge finding housing this fall.
The commercial rental market is gaining ground as well. Based upon information from the City of Grand Junction, the commercial building vacancy rate is at about 6 percent. This leads one to believe the retail and service economy here is doing much better than other parts of the country.
If one was able to finance and build an industrial building or multi-family project, now would be a great time. Land prices are the lowest they have been, around $2.50 to $5 a square foot. There’s lots of available labor and contractors are eager to work on new project construction.
Always choose an experienced broker for your real estate needs.