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Tuesday, October 06, 2009

Apartment Vacancy Rate at 23 Year High

by Calculated Risk on 10/06/2009 12:20:00 AM

From Reuters: US apartment vacancy rate hits 23-year high-report

The U.S. apartment vacancy rate rose to 7.8 percent in the third quarter, its highest since 1986, ... according to Reis.
"It makes me wonder whether the avalanche is on its way for office and retail (real estate) unless things change really quickly and really drastically," Victor Calanog, Reis director of research, said.

Reis still expects the U.S. apartment vacancy rate to pass the 8 percent mark by perhaps next quarter but certainly by next year, Calanog said. That would make it the highest vacancy rate since Reis began tracking the market in 1980.

In the third quarter, the U.S. apartment asking rental rate fell 0.5 percent to $1,035 per month, the fourth consecutive declining quarter. ...
Note: the Reis numbers are for cities. The overall vacancy rate from the Census Bureau was at a record 10.6% in Q2 2009. This also fits with the NMHC apartment market survey.

Rising vacancies. Falling Rents. Here comes the Fed's nightmare.