DENVER -- The Denver metro area is in the middle of what experts are calling a rental crisis as the cost of renting an apartment continues to soar.
A report from Zillow shows how deep renters have to dig into their pockets each month and Denver is not alone as rents are going through the roof across the country.
The average rent in the Denver metro area is $1,868 a month, a spike of 11.6 percent over last year, the third-highest percentage spike behind only San Francisco (14.9 percent) and San Jose, Calif. (12.9 percent).
Across the country, rents are growing at their fastest pace in two years, up an average of 3 percent.
Rents are growing faster than home values in 20 of the 35 largest metro areas, with Denver home values up 14.2 percent over the past year to $294,100, the largest percentage spike in the country.
But experts say the pace for home values is expected to slow in the coming year but that might not be the case for renters.
“There are tremendous incentives to get into homeownership these days: mortgage access is improving, interest rates are low, and home values remain below prior peaks,” Zillow chief economist Stan Humphries said. “But it will be increasingly difficult for many renters to realize these benefits as this country’s growing rental affordability crisis continues to worsen.
“More income going to rent means less going to savings for a down payment and other costs, keeping renters renting longer and feeding into the high demand that is contributing to rising rents in the first place. This cycle will be difficult to break and is a symptom of the imbalances that still exist in the housing market as we struggle to get back to normal. New construction and rising wages will help, but neither is coming very quickly.”
Tim Premus and Kiendal Smith say their rent was set to jump by $400 a month, so they looked at some 40 properties before settling on a home in Park Hill, which now costs them $25 bucks a month more than their old apartment.
“We bought our home because we couldn’t afford to rent anymore and we thought it was silly to throw that money away.
Now the family has 2,000 square feet, front and back yard plus a garage.
|Zillow Home Value Index (ZHVI)||Zillow Rent Index (ZRI)||Zillow Home Value Forecast (ZHVF)|
|Metro||April 2015 ZHVI||Year-over-Year percent Change in ZHVI||April 2015 ZRI||Year-over-Year percent Change in ZRI||Expected Year-over-year percent ZHVI change for April 2016|
|United States||$178,400||3.0 percent||$1,364||4.0 percent||2.0 percent|
|New York||$379,400||0.8 percent||$2,372||3.4 percent||-0.5 percent|
|Los Angeles||$534,300||3.1 percent||$2,498||5.6 percent||1.1 percent|
|Chicago||$186,800||1.1 percent||$1,610||-1.0 percent||1.2 percent|
|Dallas-Fort Worth||$159,700||11.0 percent||$1,465||5.5 percent||5.7 percent|
|Philadelphia||$200,500||0.8 percent||$1,567||2.8 percent||0.3 percent|
|Houston||$158,300||9.9 percent||$1,513||6.1 percent||3.0 percent|
|Washington, DC||$360,700||1.2 percent||$2,107||2.1 percent||0.3 percent|
|Miami-Fort Lauderdale, FL||$214,400||9.9 percent||$1,796||3.2 percent||0.7 percent|
|Atlanta||$155,700||7.8 percent||$1,247||4.9 percent||3.9 percent|
|Boston||$364,900||1.7 percent||$2,184||5.2 percent||0.7 percent|
|San Francisco||$738,200||10.3 percent||$3,162||14.9 percent||5.0 percent|
|Detroit||$114,300||5.1 percent||$1,121||6.0 percent||2.8 percent|
|Riverside, Calif.||$285,100||5.9 percent||$1,674||4.2 percent||4.7 percent|
|Phoenix||$201,800||4.5 percent||$1,247||5.4 percent||2.1 percent|
|Seattle||$348,700||6.9 percent||$1,858||6.2 percent||6.8 percent|
|Minneapolis-St Paul||$210,300||2.7 percent||$1,513||-0.3 percent||2.2 percent|
|San Diego||$475,600||4.1 percent||$2,330||5.1 percent||1.2 percent|
|St. Louis||$133,700||3.3 percent||$1,137||4.5 percent||2.9 percent|
|Tampa, Fla.||$149,800||7.2 percent||$1,281||4.1 percent||2.4 percent|
|Baltimore||$241,500||0.2 percent||$1,734||2.7 percent||0.6 percent|
|Denver||$294,100||14.2 percent||$1,868||11.6 percent||5.7 percent|
|Pittsburgh||$124,200||2.0 percent||$1,124||4.4 percent||1.8 percent|
|Portland, Ore.||$282,900||4.7 percent||$1,614||8.6 percent||4.2 percent|
|Sacramento, Calif.||$338,200||6.7 percent||$1,660||5.9 percent||5.6 percent|
|San Antonio||$147,600||3.2 percent||$1,316||4.6 percent||3.4 percent|
|Orlando, Fla.||$170,500||6.0 percent||$1,319||2.0 percent||2.8 percent|
|Cincinnati||$137,000||2.5 percent||$1,244||6.2 percent||2.5 percent|
|Cleveland||$120,300||0.7 percent||$1,161||2.4 percent||2.4 percent|
|Kansas City, Mo.||$138,900||0.3 percent||$1,240||9.5 percent||3.2 percent|
|Las Vegas||$186,700||7.1 percent||$1,200||2.1 percent||4.1 percent|
|San Jose, Calif.||$873,600||11.9 percent||$3,287||12.9 percent||4.9 percent|
|Columbus, Ohio||$146,900||3.5 percent||$1,262||2.6 percent||3.1 percent|
|Charlotte, N.C.||$159,200||4.5 percent||$1,253||6.6 percent||2.5 percent|
|Indianapolis, Ind.||$130,400||-0.3 percent||$1,199||1.5 percent||3.8 percent|