The report covers the Miami-Dade, Fort Lauderdale and West Palm Beach metropolitan service areas.

The vacancy rate increased from 4.7% mid-year 2002 to 6.9% after the second quarter of this year, according to the report. And the vacancy rate is expected to continue climbing at least another year, to 7.7% in the middle of 2004. In the last 12 months, demand decreased because attractive mortgage rates encouraged home ownership and because of economic uncertainty. However, the rise in vacancy rates isn't expected to last, due to increased employment.

Miami, with the weakest employment in the area, had a significant vacancy hike in the last year, according to the report. The vacancy rate rose from 4.1% in mid-2002 to 6.9% a year later.