Denver’s income restricted apartments are more vacant than market-rate ones, according to data from Colorado’s primary sponsor of new low-income housing developments.
Apartments restricted to those making 80% of the area median income are 18.7% vacant, according to data from the Colorado Housing and Finance Authority shared with BusinessDen.
Units between 40% and 60% AMI have lower vacancy rates, but remain above market-rate vacancy, which clocked in at 8.3% last quarter, per the Apartment Association of Metro Denver. Units at 60% AMI are 12.8% vacant and those at the 40% to 50% level sit at 8.4%.
Only income-restricted housing at 30% AMI and below, at 6.4% vacant, is fuller than the average market-rate building.
CHFA’s data is for stabilized apartments, which are in buildings that have been open for at least six months. It indicated that the median renter in its portfolio makes 26% of the statewide AMI, or $24,600 annually.
The odd situation stems from Denver’s current oversupply of apartments, which has pushed costs down for renters.
“Market rents are down between 50 and 60%, maybe just above 60% of AMI. The truth of the matter is that when you live in an affordable housing community … you have to income qualify every year, and that income qualification is very onerous,” said Scott Rathbun, who runs the market analysis firm Apartment Insights.
“Itap a lot harder to qualify to live in an affordable property than it is in a market-rate property. And so if people have the option, they generally choose to live in a market-rate property because itap just so much less onerous.”
The average rent in Denver is $1,800, but cheaper in many places and unit types. A studio in Cap Hill for instance, clocks in at $1,200. Meanwhile, a studio apartment at 80% AMI can top out at $1,823 per month.
“I am not surprised … over the last three years, we’ve had a record number of deliveries for market rate communities, apartments,” said Greg Glade, co-founder of local development firm MGL Partners.
Glade’s firm builds both income-restricted and market-rate apartments and has projects from Cap Hill to Parker. Glade said he’s had to lease 80% AMI units at the 60% level just to stay competitive with market rents.
Glade said that part of the challenge is that roommates are priced out of most income-restricted housing, since itap the combined salary of the group thatap used to determine renter’s AMI levels. In other words, two non-related people making 50% AMI would count as making 100% AMI, and thus be unable to rent an income-restricted apartment.
Denver’s population, too, has stagnated, with more people estimated to have left the city in 2025 than moved in for the first time since 2021, and only the second time since 2006. That trend is expected to continue this year.
However, analysts have cautioned that sky-high vacancies are expected to be a blip in the data, and that future projections are not so renter-friendly. While lots of apartments were added in recent years, few are slated to be completed in the immediate future.
“It will probably go back to ‘normal’: where we have very high occupancy and very low vacancy in [income-restricted] properties by 2028 and moving forward. Because, I think for many reasons, the pipeline is kind of falling off a cliff right now,” said Rathbun, who compiles data for the Apartment Association’s report.
“We’re going to go right back to a place where we have undersupply, and demand exceeds supply. And when demands exceed supply, prices go up.”
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