Colorado’s population growth is beginning to slow at the same time as a wave of new multifamily units have driven Denver-area apartment vacancies to their highest level in 16 years.
The state’s population grew by just 0.4% in 2025, according to the latest statistics from the Colorado Demography Office, and more people left the state last year than moved into it for the first time in two decades.
These changes, after many years of strong population growth, could shift the balance for renters in the city who have contended with increasingly high rates since the Global Financial Crisis.
“We could actually get ahead of spiking rental rates right now if we start to backfill the pipeline, and I’m hopeful because I see interest in it,” said Brad Buchanan, director of Denver’s planning department.
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Rents for Class-C units are currently below what the city charges for permanently subsidized affordable housing units, Buchanan said. The relative affordability of the city’s older stock could pile on to factors such as slowing population growth and high vacancy to put a dent in the city’s affordability problem.
“There’s naturally occurring affordable housing here,” he said. “We have the opportunity right now to solve affordability in our city if we take some smart next steps.”
In the last quarter of 2025, the average rent fell to $1,754 per month, according to the Apartment Association of Metro Denver. At the same time, Denver experienced its highest multifamily vacancy rate, 7.6%, in 16 years.
Though Colorado has continued to grow in population for the past several years, that expansion has been slowing, with 2025 having the smallest growth since at least 2001. That mirrored the national population increase of 0.5%.
Nationally, the largest rent declines are in cities with heavy supply, while renter demand is growing in tech-focused coastal cities, pushing average rents to increase, per a January analysis from RealPage. It found that Denver saw the second-largest decline nationally in annual effective rent, following Austin.
Around 125,000 multifamily units were built in the metro area over the last decade and have mostly been absorbed, but at the end of last year, about 34,200 units were vacant, according to the Apartment Association of Metro Denver.
Even more supply is in the pipeline, with AAMD estimating 50,000 units in the works, though 20,000 of those have yet to break ground and may not come to fruition. Buchanan said, ideally, the supply would stay consistent to help keep rents affordable.
However, Scott Rathbun, head of Apartment Insights, told the Denver Post he doesn’t think the slowing growth is yet cause for concern because for-sale home prices remain high in the state.
Renting remains the more economical choice in the Denver metro, about $2,000 per month cheaper than owning in Q3 2025, according to CBRE.
CBRE’s 2026 outlook says new deliveries are expected to continue apace through this year but decline sharply in 2027, partially due to local requirements for multifamily developments to include affordable housing.
Rathbun said if supply drops off, rents could rise again in 2027 and 2028.
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