"Investment activity has reflected a wait-and-see attitude," Robert W. Miller, senior vice president, multi-housing properties group, CB Richard Ellis, tells GlobeSt.com. "Developers, equity partners and lenders are approaching new projects with more caution."

Besides the dearth of class A for-sale product, there is also a shortage of prime development sites. The resulting effect is a plunge in building permits and a definite construction slowdown.

Miller feels this scenario should generate strong competition for the available properties for the rest of the year. "Demand for apartment properties by private capital investors should remain strong (but) institutional buyers remain on the sidelines," the broker says. However, Miller doesn't think sales volume will approach the 2000 number.