The report indicates that a strong economy and possibly slowed construction rates have reduced multifamily vacancy from 10.6% at the end of the first quarter in 2000 to 8.7% in the same quarter of 2001. Of course, only 1,404 new units have delivered in Q1 as opposed to 2,974 units one year ago. The report says new construction is concentrated in the West Houston-Westheimer, Southwest Houston and Pasadena submarkets. The report also puts new construction at 6,874 units and another 8,867 units on the drawing boards. Interestingly, the report says most new apartments are class-A as class-C properties continue to fall off the radar screen.

Absorption is up as well. According to the report, 4,136 units had been absorbed in the first quarter in comparison to 2,941 units one year ago.

Rents also are up this year, reflecting an average 4.3% growth in the past March to March accounting. Last year, the average rental rate had been $554 per month while this year's is riding at a $577 average. According to the report, the West Loop submarket has the highest average monthly rent, $748, and East Houston, the lowest at $403.