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Apartment Vacancy Expected to Inch Up in 2004

MIAMI-The increase should not be as much as this year, according to Marcus & Millichap Real Estate Investment Brokerage Co. A recent report by the company also states that asking rents are expected to continue to rise next year, while completions planned for next year are just about two-thirds the number completed this year.

By Melissa Bogdany | Updated on December 08, 2003

MIAMI-Vacancy in South Florida’s apartment market is predicted to rise moderately next year, following more significant increases this year, according to Encino, CA-based Marcus & Millichap Real Estate Investment Brokerage Co.’s newly released Apartment Research Report for the South Florida market.

The report also shows that consistent employment growth and population have helped maintain strong tenant demand, and capital will continue to be drawn into the area’s multifamily market. In addition, area rents should continue to rise. “South Florida’s multifamily investment marketplace has shown vibrancy in 2003, with median prices up throughout the region,” Gene A. Berman, senior vice president and regional manager of the company’s Fort Lauderdale, FL, office, states in the report. “The market forecast calls for vacancy to peak in 2004 and wane thereafter, and rent growth to persist, indicating an attractive investment market that will fuel asset appreciation.”

The regional vacancy rate is expected to increase to approximately 6.9% at the end of this year from 6.1% last year; an extra 40-basis-point hike to 7.3% is predicted for next year. All three metropolitan service areas in the South Florida region reported increasing vacancy rates this year. Fort Lauderdale rose from 5.3% to 6.2%, while Miami grew from 5.5% to 6.4%, and West Palm Beach went from 8.7% to 9.2%.

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