There were nearly 46,000 units under construction in the 7-county metro area as of the 3rd quarter 2023 , all of which will deliver over the next few years . As those units are delivered , vacancy throughout the metro area is likely to increase and rental growth is likely to slow . However , after these apartments are completed , we expect future deliveries to shrink as a result of the EHA . The shrinkage will be further exacerbated if surrounding communities adopt similar policies . So , when demand begins to significantly exceed supply again beginning around 2026 , and rents skyrocket , we must all remember why and try to learn from our past mistakes .
tale to officials throughout the state , and across the country , that such policies do not work as intended . The unintended consequences do not outweigh the relatively small increase in affordable units that they generate . Further , if other municipalities similarly disincentivize market rate apartment development , there will be even fewer apartments built in the future , causing an even bigger housing affordability crisis throughout the region . There is no question that there truly is a significant need for additional affordable housing in Denver and throughout the 7-county metro area .
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However , we believe the development community , municipalities , and voters should instead focus their time , effort , and financial resources on trying to expand the Low-Income Housing Tax Credit ( LIHTC ) program , or similar programs , which have proven to work well and provide affordable housing in a financially feasible manner .
Updated from an article originally published in the August 2 , 2023 issue of Colorado Real Estate Journal
Other municipalities throughout Colorado are considering implementing similar inclusionary housing ordinances , and a few have already implemented similar policies . However , the case study in Denver should act as a cautionary
Scott Rathbun is the Owner / President of Apartment Appraisers & Consultants , Inc . His analysis and expertise has been featured in this magazine , Colorado Real Estate Journal and more .
A recent study found that properties that allowed smoking had nearly double the costs of smoke-free properties .
Smoke-free policies help property managers and owners protect their residents ’ health and real estate investments . Don ’ t go it alone . Contact us for help implementing and or enforcement of your smoke-free policy . Reach out to Peggy . sarcomo2 @ denvergov . org or info @ gaspco . org in partnership with :
Denver Department of Public Health & Environment is not engaged in the practice of rendering legal advice .
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