Rents, new construction, absorption, building permit totals and investor demand were all soft and are expected to remain that way, at least for the first half of 2002. Rent concessions, however, are growing. On the investment side, demand was steady but product was limited.

"Many potential sellers have decided to hold off on selling their properties, based on the current economic conditions," Robert W. Miller, senior vice president, multi-housing properties group, CB Richard Ellis, tells GlobeSt.com. "With increased demand and a reduced supply of properties on the market, we expect to see strong competition from buyers for those properties that do become available in 2002."

Private capital investors will be the group vying for the bulk of the assets, largely because of the low interest-rate environment, Miller predicts. However, "with fewer properties on the market for sale, we expect that during 2002, there will be fewer multifamily sales than in 2001," the CBRE executive says.