The U.S. apartment vacancy rate eased to its lowest level in more than a decade, but stagnant income growth moderated rent increases, according to an industry report.
The national apartment vacancy rate fell 0.1 percentage point to 4.1 percent in the fourth quarter from the third quarter, according to a preliminary report by real estate research firm Reis Inc. It was the lowest vacancy rate since the third quarter of 2001, when it was 3.9 percent
A sluggish job market and weak wage growth help keep rent growth at just 0.8 percent, however, well below the level usually associated with such low vacancy rates.
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"While national rent growth remains low relative to vacancy, there are a number of markets where rents continue to boom such as Seattle, San Francisco, San Jose and Oakland-East Bay," the report said.
New Haven ranked as the city with the tightest vacancy rate at 2.2 percent. San Diego, San Jose and New York came in at numbers two, three and four, respectively.
With more housing supply coming online, Reis expects vacancies to increase slightly in 2014 while rents rise by roughly 3.3 percent.
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