Denver rents increased by double digits between August 2021 and August 2022, according to a new report.

The report, issued by the Apartment Association of Metro Denver, noted that average rents increased by 12.6% during the year of the study. The average cost to rent in the Denver metro area is now $1,860.

Meanwhile, vacancy rates rose slightly from the first quarter of 2022 to the second quarter – from 4.3% to 4.7%.  A study by Anytime Estimate noted that Denver’s apartment vacancy rate is one of the lowest in the country. The national average vacancy rate, according to the Denver Business Journal, was 5.8% in August, 2022.

The economy appears to be driving the rent increases. “With soaring inflation and dramatic increases in expenses for housing providers, it was expected to see rising rent levels,” Drew Hamrick, senior vice president for government affairs for the Colorado Apartment Association, noted in the report.

“The key to housing affordability is housing supply,” he added. “We need to incentivize new development through sensible, pro-building policies like tax credits, development grants, and permit-fee reductions. If we don’t increase our rate of construction, prices will continue to rise.”

To that end, the Denver Business Journal reports that 50 new “apartment communities” are currently under construction, which will add 40,000 new units, hopefully within the next two years.