(Read more on the multifamily market.)

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DALLAS-Although this year's deliveries are pushing 7,200apartments, Greater Dallas' multifamily market is sure to come outunscathed with teardowns keeping net inventory growth at its lowestpoint in 17 years. The reality is the scrape-and-rebuild fever ofmunicipalities and developers has added just 487 units to theregion's total.

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"I don't think people have grasped that we're not growinginventory at all in Dallas," Greg Willett, vice president of M/PFYieldStar in Carrollton, tells GlobeSt.com about the 537,000-unitgrand total. In checking the past, he says 1990 had just one243-unit project completed due to fallout from the savings and loandebacle, but this year's marginal gain is squarely tied toteardowns.

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Northeast Dallas' Highlands area is leading all submarkets interms of teardowns--3,200 apartments. Willett says the secondclosest competitor is 400, which is cropping up in a handful ofpockets. Scraping and rebuilding is widespread, but somemunicipalities like Arlington and Irving are urging owners to razevintage complexes, but they aren't gaining much ground in the arenadespite the possibility of incentives. The tentative numbers showArlington lost 71 units and Irving didn't lose any.

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Willett says developers have delivered 7,155 units in GreaterDallas this year, creating the second largest block of supply tocome on line in the nation. The teardown count is 6,668 units. Asfor the US leader in completions, it's Houston with nearly 10,000new apartments.

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"I think we're going to be in good shape in 2008," Willettpredicts about Greater Dallas. "The real unknown is if demand isbeing inflated because people can't get loans on homes, evenreasonably qualified people. And, if it changes, which it mostlikely will, will it unleash buyers."

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M/PF's fourth quarter stats will be finalized next week. Itsthird-quarter report put occupancy at 93.4% at pre-1970 complexes;92.4% for the 1970s-era construction; 94.1% for 1980s-erainventory; and 96.1% for 1990s and newer complexes. Monthly rentsin the categories average $619 for pre-1970s, $606 for 1970s, $630for 1980s, $925 for 1990s and $978 for the newest developments.

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Based on the average category rents, Willett concludes residentswho were forced to relocate had plenty of choices. "It's low enoughthat there were other places for people to go. We don't have anyshortage of affordable places for people to rent in D/FW unlikeother places," he says.

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