(To read more on the multifamily market, click here.)

HOUSTON-A softening multifamily market in the third quarter is adirect contrast to the surge in activity last year at this time asHurricane Katrina evacuees began to pour into the city. Localexperts say the softening was to be expected due to increasingconstruction and departing Katrina households.

According to the Carrollton-based M/PF YieldStar's Q3 report,average occupancy is 93.5% versus its 2005 peak of 94%. The class Aassets are reporting the highest occupancies, 95%, in the market.Older product, though, is softer, with the average occupancystanding at 92%. As a result, rent increases have been impactedtoo, with the annual change from last year up just 0.1%.

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