2013 was a record year for Central Denver apartment prices. The volume of deals was robust, and the average sales price surged to $106,911/unit! This average price per unit represented a 14% increase over 2012, and an amazing 51% increase over 2011’s average price!
The wide array of properties that sold for high prices was remarkable. 36 buildings (well over half of the total transactions) sold for over $100,000/unit. By comparison, in 2011 there were only three deals that hit that price level. Growing investor demand is being fueled by, low interest rates, low vacancy and rents that have reached all-time highs.
The Seller’s Market has continued in 2014! During the first quarter we have sold a building in the Congress Park neighborhood for $117,000/unit, and one near Cheesman Park for $134,000/unit. And next week we’ll close 26 units on Capitol Hill for $136,000/unit.
Rising interest rates, new apartment construction, and higher vacancy rates are all factors that could dampen prices in 2014. We will be watching those key indicators closely for signs that the market might be shifting. We should all remember, however, that sometimes just the possibly of those indicators moving is enough to shift the market.