Landlords struggling to find right rent here

Metro Denver landlords are cutting their advertised rents at one of the highest rates in the country, while area home sellers are tracking with the national average in getting the initial price right, according to a study from real estate website Trulia.

Of the metro Denver rental listings that Trulia tracked for the 12 months through April 30, 18.5 percent had a reduction in the originally listed rent, up from 16.3 percent the prior year.

That rent reduction ratio ranked third-highest after San Jose, Calif., at 20.1 percent and San Francisco at 19.8 percent out of 100 metro areas that Trulia tracked. Boston; Fresno, Calif.; and New York’s Long Island had the lowest rates of rent readjustments, all under 5 percent.

But rent reductions don’t mean low rents. San Francisco and San Jose have some of the highest rents among coastal cities, while metro Denver rents are among the highest of any interior city, according to a separate survey from ApartmentList.

Nationally, just shy of one in 10 rental listings, 9.7 percent, took a cut in the listed rent, up from 8.6 percent the prior year. About 83 out of the 100 metros saw a larger share of rental listings take a cut the past year than in the prior year.

Nationally, rent increases have plateaued and more landlords are starting to realize that rent hikes year-after-year aren’t a given, noted Felipe Chacón, author of the report.

That realization should contribute to fewer price cuts in the future and points to a “more stable national rental market,” he said in the report.

If metro Denver landlords are struggling to get the rents right, home sellers here aren’t too far from the national average.

Nationally, 10.9 percent of home listings took a cut the past year, while in metro Denver 11.3 percent did. That ranked 77th lowest out of the 100 markets Trulia studied.

Supply imbalances could explain why homeowners are doing a better job than landlords of getting the price they want. The region has seen a record surge in new apartments, but new homes are being added at a slower pace than in past decades, boosting demand for existing homes.

Compounding the problem, many of the apartments and homes built are on the more expensive end of the market, while the jobs created in metro Denver are mostly on the lower end of the wage scale, said Mark Vitner, a senior economist with Wells Fargo Securities.

“There is a real affordability issue in Denver,” Vitner said, adding that could be contributing to a recent slowdown in inbound migration and job growth.