Rent Prices Still Rising Faster Than Inflation: What Denver Landlords and Residents Need to Know in 2025

Rent Increases Continue to Surpass Inflation — What That Means in 2025

Talk to anyone living in Denver or the foothills lately, and you’ll hear the same thing: rents just won’t slow down. Here, where rental properties are in high demand and homeowners look for opportunities to maximize their income, staying on top of the rental market is more important than ever. As 2025 gets underway, it’s clear that rent growth is outpacing overall inflation, and that’s affecting everyone from tenants to property owners considering short-term rental management.

Latest Numbers: How Rent is Outpacing Inflation

As of September 2025, rents across the country saw a 3.5% increase compared with the previous year, according to the most recent consumer price index. While the overall “shelter” category also rose 3.6%, rent specifically maintained its steady climb. This jump is not just a national trend—it’s hitting close to home in Colorado, impacting both those searching for a place and owners renting out units in Denver’s competitive market.

It’s important to understand how these numbers are compiled. The Consumer Price Index (CPI) often lags behind what people actually see in the market, largely because most leases last a year. So rental data, whether collected by government agencies or websites like Zillow, reflects past activity rather than the day-to-day shifts many landlords and renters feel.

What’s Shaping Today’s Rent Prices?

In September, Zillow reported the most affordable rental environment in four years. Typical rents reached $1,979 in September 2025—down slightly from August but 2.3% higher year-over-year. While that’s below the wild spikes of 2022 and puts growth beneath traditional averages, current rent levels are still a staggering 35.1% above pre-pandemic times. Denver renters and property owners have seen firsthand how resilient rents have remained, even as sales markets cooled.

This cooling is motivated by a few key shifts:

• There are simply more homes available to rent than in recent years, pushing landlords to compete for quality tenants.
• The housing market slowdown makes long-term leasing more appealing for property owners, especially those seeking reliable income without constant turnover.
• A typical renter now spends roughly 28.4% of household income on rent, which translates to an annual income requirement approaching $80,000 just to afford a mid-market lease.

Rental concessions hit a new high in September—about 37% of metro listings nationwide, including Denver, included perks like a free month, indicating landlords are responding to softened demand. In fact, Denver saw one of the largest jumps in concessions among major cities.

Where Can Renters Find Relief—or Face Even Higher Costs?

This past September, month-over-month rents dropped in 34 metropolitan areas, including a -0.7% dip in Denver. Compare that with sharp increases in Chicago, San Francisco, and New York, where annual rent growth topped 5%. If you’re a property owner in Denver, it’s critical to recognize that although the region saw a minor decrease, prices here remain elevated compared to prior years.

The most affordable metro areas included Austin, Salt Lake City, Raleigh, Minneapolis, and St. Louis. In contrast, markets such as New York, Miami, Los Angeles, San Diego, and California’s Inland Empire remained the priciest.

Why Is Rent Still So Unaffordable?

High rents aren’t just a relic of the pandemic—they’ve become a defining issue. A late-2024 study from the Joint Center for Housing Studies of Harvard University reported that, in 2023 alone, more than 22 million US rental households faced unaffordable rent burdens. According to federal guidelines, spending 30% of income on rent is considered “moderate” rent pressure, while hitting the 50% mark is labeled “severe.” Alarmingly, by Harvard’s numbers, half of all renters put at least 30% of their income toward rent and utilities, and a quarter spent more than half on housing costs. Those statistics hold true here in Colorado as well, making affordability a pressing concern for both tenants and the landlords who serve them.

Half of renters now dedicate 30% or more of household income to rent, and over a quarter spend 50% or more.

Several forces are driving these relentless rent hikes:

• Inflation: Landlords continue to pass along higher maintenance and repair costs. Rent increases feed overall inflation, fueling an ongoing cycle.
• Limited Rental Supply: There aren’t enough vacant or affordable units, especially in cities like Denver where demand is consistent all year.
• Homeownership Barriers: Rising mortgage rates and tight inventory prevent renters from buying, keeping more people in the rental market for longer.
• Pandemic Policy Expirations: Urban rents, previously frozen or discounted during the pandemic, rebounded sharply as landlords recouped their losses.
• Changing Preferences: More tenants are seeking one-bedroom or studio apartments, which drives up demand for those units in desirable urban neighborhoods.
• Remote Work Remapping: After 2020, a new wave of remote professionals sought larger homes in previously overlooked locales, causing rents in the suburbs to surge without a comparable decline in urban rates.

It’s also worth mentioning another uncomfortable truth: wage growth hasn’t kept up. Since 2019, rents have ballooned at 1.5 times the pace of average earnings. For property owners considering Airbnb or short-term management in Denver, understanding this wage-rent gap is key—it shapes everything from tenant demand to nightly pricing strategies.

Will Rent Prices Finally Drop in Denver?

If you’re wondering when rents might actually decline, there are a few glimmers of hope. In several major cities, rents are already inching down, thanks largely to a construction boom. According to Yardi Matrix, 2024 saw developers complete over half a million new apartments across the US—the second annual record in a row. RentCafe projects another 2 million new units by 2028. In cities with lots of new construction, including areas of Texas and Colorado, this increased supply has started to put a ceiling on rent growth.

Inclusionary zoning plays a local role too, requiring that a portion of new buildings remain affordable. So, this isn’t just adding supply—it’s delivering on affordable housing mandates as well. If Denver’s pipeline remains steady, both renters and property owners should see more options at every price point in the coming years.

Short-term discounts and incentives, from weeks of free rent to waived application fees, also suggest that Denver landlords are adjusting expectations to avoid vacancies. For owners, that may mean refining their approach to marketing and tenant screening—whether for traditional leasing or vacation rentals. For renters, an uptick in available concessions could finally take some pressure off monthly budgets.

What’s the Bottom Line for Denver Renters and Owners?

It’s a pivotal market moment. While rents have slowed from their pandemic-era frenzy, they’re still at historic highs and continue to exceed inflation. That means both property owners and tenants need to be proactive in 2025: keep informed, know what’s moving the local rental market, and watch for new developments that could shift the balance.

For those managing or considering short-term rentals throughout Denver or the Front Range, staying up to date on these trends isn’t just about maximizing income. It’s about meeting changing expectations—delivering great value to renters while ensuring ongoing success for your property.